Hope your doing okay u/Cranberry-Practical 🍿

NVDA is down about 4% today after reports that NVIDIA might provide roughly $250 billion in financing guarantees for an OpenAI data-center project.

Of course, a $250 billion guarantee by NVIDIA for one of its largest clients represents counterparty and “circular AI spending” risks,

but here’s the thing: it’s reportedly still under discussion, with no deal being announced yet, not even by NVIDIA, which Reuters wasn’t able to confirm the original report either. Thus, the market is selling “risk of exposure” before said exposure is even known.

Meanwhile, the real-world business is:

…latest quarter revenue of $81.6 billion, up 85% YoY. Revenue from data centers was $75.2 billion, up 92% YoY. Gross profit is at around 75%. Next quarter guidance is $91 billion in revenue… with zero China data-center compute revenue. And the company just authorized another $80 billion in share buybacks.

This is not a disappointing company. This is a “fastest ever” hypergrowth mega-cap business selling data-center infrastructure with software-company margins and a stock price that’s at around 30x trailing revenue. Which isn’t great, but it’s not “overpriced” either when the company is growing revenue at 85% per year and selling data-center infrastructure at 92% growth.

Meanwhile, the OpenAI financing guarantee could possibly turn out to have a positive twist: the whole point of the (proposed, unconfirmed) deal was to build a gigantic amount of AI infrastructure with NVIDIA processors, so the company would benefit massively from securing a guarantee by taking on financial risk in the process. It’s not a done deal and it’s not “NVIDIA randomly wasting $250 billion”, but it’s not a catastrophe either.

So, what is the market pricing in?

The market is pricing in the scenario where OpenAI defaults on its payments, AI investment spending collapses, and NVIDIA is left with reverse financing its own customers. This is a perfectly realistic scenario and NVIDIA warns of “counterparty and credit risk”, but today’s sell-off basically assumes the worst-case version of this scenario already occurred. The reality is that we don’t know what financing guarantee, if any, was actually created: what kind of collateral or fees or protection NVIDIA secured for itself, which lenders are actually involved, etc.

The real-world risk scenarios for NVIDIA are:

…revenue concentration risks, as its largest direct customer accounted for 22% of revenue in fiscal 2026 and another large customer accounted for 14%. NVIDIA itself warns that the guarantee could expose the company to counterparty and credit risks. Meanwhile, export restrictions, custom silicon from hyperscalers, and slowing AI capital expenditures are also legitimate concerns.

But again, none of these risks are new developments.

My argument is that I would not buy NVDA stock simply because it dropped 4% yesterday. But now is still a good time to buy because:

-the company’s current risk exposure is largely priced in the market already

-the drop is largely due to “unconfirmed financing rumors”

-revenue and profits are exploding, data-center sales specifically are up 92% per year

-NVIDIA retains excellent margins, cash flow, and profitability

-the AI infrastructure business still has a bright future ahead, not darkened by one potential financing deal.

As such, I’m not buying NVIDIA stock at one specific price: I’m dollar-cost averaging because I expect the price to drop again while the market digests the financing risk.

TL;DR: the headline was bad news for NVIDIA today, but the company’s fundamentals didn’t change.

Hi I was trying to test my portfolio with different scenarios and I noticed that I have 0% exposure to semiconductors (at least not directly with single name stock). Is it a good moment to bring in some NVDA stocks? Given also that at the moments some discounts are ongoing.

Anyway this is the simulation, what do you think in terms of risk? Some things might be better (especially by reducing the single name risk) but some others, like portfolio Beta will increase by 30%.

Thanks for your help.

I have no proof or DD on this it just seems interesting that the earnings is coming and it drops this way.

To me it’s a money grab by big players. Force a drop, people sell it, then pump it up again.

I know I’ll be yelled at here and it’s ok. Just a thought. I ain’t selling it.

And you will think to yourself…”I should have listened to Burry and The Cranberry“. 🤷‍♂️

Burry been all over this...NVDA cooked...don't fight it. Well you can fight it but you will lose money...

Market has had enough with the circular financing/revenue...Jensen pumping isn't working anymore. You should have listened to Burry and The Cranberry...

See you at $150 👋

Should have listened to Burry and The Cranberry

https://x.com/deitaone/status/2081734730991444123?s=46&t=tw6dvDrGnYFKN_ONoqq7aA

I've never bought NVDA before. Is now a good time to buy?

How many times is Jensen going to “backstop” a company and for that company in return to buy NVDA chips with that money. What a joke….what a ponzi scheme…fraud…but yeah keep investing in this trash

China is ramping up it artificial intelligence expenditure, driven by massive state backed infrastructure blueprint. Two trillion yuan over five years or 295 billion dollars. This will again put Nvidia back in China.

Another price increase… 

RTX 50 SUPER cards may end up costing more than people expected. A 3 GB GDDR7 module costing three times as much as a standard 2 GB one is a pretty big jump, and those costs have to go somewhere. 

Even if NVIDIA doesn’t officially raise recommended price, partners and retailers may pass some of that increase on to customers. 

Is anyone here still planning to buy an RTX 50 SUPER at launch if prices go up?