Key Takeaways NVDA shares tumbled 5% Monday, causing the chipmaker to surrender its crown as the world’s most valuable company back to Apple. The company’s forward price-to-earnings ratio plu
Monday’s trading session saw Nvidia’s forward P/E ratio sink to 18.16 — marking the chipmaker’s lowest valuation metric since April 6, 2015, based on data from Dow Jones Market Data.
Shares plunged 5% during the session, stripping Nvidia of its status as the planet’s highest-valued company. Apple seized back the number one position.
In Tuesday’s premarket session, NVDA continued its slide with an additional 0.8% decline, indicating that investors weren’t ready to step in yet.
The decline occurred during a challenging session for the entire semiconductor industry. News that a Chinese manufacturer has started mass-producing critical chip fabrication equipment sent shockwaves through the sector.
ASML suffered an 8.5% decline following that development. The Netherlands-based company plays an essential role in the worldwide chip manufacturing ecosystem.
China’s memory chip manufacturer CXMT also launched a successful market debut, intensifying worries that legacy chipmakers could encounter heightened competition moving forward.
The rout extended beyond European borders. South Korea’s KOSPI index plunged nearly 10%, activating trading halts. Japan’s Nikkei index declined 4.4%.
Apart from the China-related developments, a more targeted concern emerged specifically affecting Nvidia. According to The Wall Street Journal, Nvidia is engaged in discussions with OpenAI concerning a $250 billion guarantee to support financing for an Ohio data-center initiative.
Other reports suggested that Nvidia might also participate in financing arrangements covering up to $350 billion for OpenAI’s chip acquisitions.
These massive figures prompted a basic question from the investment community: has AI infrastructure spending become overly reliant on chip manufacturers financing their own client base?
This arrangement — where vendors essentially bankroll their customers — creates a financial risk dimension that markets are still attempting to properly evaluate.
The selloff’s timing amplifies the importance of imminent Big Tech earnings releases. Apple, Meta, Microsoft, and Amazon are all scheduled to report results this week.
Market participants will scrutinize their capital expenditure forecasts closely. Any indication of reduced AI infrastructure investment could compound pressure on Nvidia shares.
Conversely, Nvidia’s current valuation has reached a threshold unseen for more than ten years. For investors with long-term horizons, this represents a significant data point.
Nvidia shares have advanced only 5% in 2026, underperforming the wider semiconductor industry year-to-date.
The primary catalysts ahead include hyperscaler earnings reports, any clarification regarding Nvidia’s financial exposure through OpenAI arrangements, and continued progress in China’s indigenous chip equipment manufacturing capabilities.
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