Nvidia falls into a bear market, is the AI bull run over?

Ask AI · Is Nvidia’s stock decline due to intensified competition?

When the hottest stocks in the world begin to fall, the market is often not just panicking—it starts to question an era. In spring 2026, the “flagship” of the artificial intelligence (AI) wave—Nvidia—is going through such a moment. Overnight, “the most certain trade” starts to waver: over the past two weeks, Nvidia’s stock price has kept falling. According to Wind’s latest data, as of early April, from the company’s prior all-time high, the stock has accumulated a drop of more than 20%, once dipping into a technical “bear market zone” (meaning a pullback of 20% or more from the high). Even more striking is the pace of Nvidia’s stock decline: the weekly drop once exceeded 8%, multiple trading days saw “high opens and low closes,” and after earnings report positives, the stock price didn’t rise—it fell instead.

All of this has caused the market to re-examine this AI leader that was once “only going up.”

Over the past two years, Nvidia has almost been a “faith-based asset.” As long as there’s good news about AI, it automatically translates into a positive for Nvidia. But now, the market logic is changing, and the most alarming danger signal for investors is that good news is no longer pushing the stock price upward. In its latest earnings report, Nvidia still delivered strong figures: for fiscal year 2026 fourth quarter, revenue reached a record $68.1 billion, up about 73% year over year; data center revenue reached a new high of about $62.3 billion, up about 75% year over year; full-year revenue was approximately $215.9 billion, up 65%. Gross margin stayed at a high level, and the company’s revenue guidance for the first quarter of fiscal year 2027 exceeded expectations, showing that demand for AI infrastructure remains strong. But the stock price fell after the earnings were released.

Nvidia’s slide into a bear market is not coincidental. First, more than 60% of Nvidia’s data center business revenue comes from the five biggest cloud giants: Amazon, Microsoft, Google, and Meta. In the first quarter of 2026, the combined capital expenditures of the four giants increased by only 12% year over year, far below the 35% growth rate in 2025. Microsoft and Google are accelerating their in-house AI chip development, planning to raise the share of self-developed chips to 30% by the end of 2026, directly hitting Nvidia’s orders. Second, the bigger threat: Nvidia is no longer “the only one.” In the past, Nvidia was almost the sole choice for AI computing power. But now: cloud giants are speeding up their own chip development, Advanced Micro Devices (AMD) continues to catch up, and customized AI chips are starting to emerge. Even if Nvidia’s “moat” is still deep, it is not unbreakable. In other words, Nvidia’s “pricing power” may face challenges in the future. Third, the macro environment in the United States also cannot be ignored. The Federal Reserve keeps interest rates high to curb inflation, and the yield on the 10-year U.S. Treasury has surpassed 4.5%. AI company valuations rely heavily on discounting future cash flows; in a high-interest-rate environment, the present value of future earnings is inevitably prone to shrinking sharply.

Has Nvidia’s stock price already fully fallen into a downward “channel”? Judging by the current situation, the answer is no. As of the close of the U.S. stock market on April 6, Nvidia’s stock price was $177.6. Compared with its recent historical high of $212.19, the decline has narrowed to 16.3%. Besides that, Nvidia’s stock price has not shown a sustained multi-month decline, nor a long-term downward trend accompanied by panic sentiment in the market. There is still the possibility of a large rebound in the future.

Nvidia’s stock price falling into a bear market also tore open a “crack” in the AI investment boom: has the AI bull market ended? The answer is no as well. From the perspective of market scale, AI growth is still on the “fast track.” In 2025, the global AI market size reached $7575 billion; in 2026, it is expected to exceed $9000 billion, representing a year-over-year increase of 18.7%. From the perspective of industry implementation, AI is moving from concepts to real-world applications. Forty percent of global enterprises embed task-oriented AI agents, and half of China’s top 500 companies have deployed AI agents.

Nvidia’s slide into a bear market does not bring answers—it brings questions. It makes the market start thinking again: where is the real commercial value of AI companies? Is the current valuation reasonable? Who will be the ultimate winner? What can be determined is this: the AI bull market has not ended, but the era of “buying with eyes closed” is over. For investors, this may be the true start of what will be a difficult journey.

🤵‍♂️Editor-in-chief: Xiao Hu, are you there? The manuscript database is almost empty!..

Source: Financial Times Client

Reporter: Molly

Editor: Liu Nengjing