SoftBank's $5.8B Withdrawal Raises Questions About AI Growth, Causing Nvidia Stock to Tumble

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SoftBank's $5.8B Withdrawal Raises Questions About AI Growth, Causing Nvidia Stock to Tumble

Bitget-RWA2025/11/13 21:36

By:Bitget-RWA

- SoftBank's $5.8B sale of its Nvidia stake triggered a 3.1% stock drop on Nov 11, 2025, signaling investor doubts about AI sector momentum. - The sell-off coincided with U.S. export restrictions to China, HBM supply delays, and AMD's $1T data-center market projections challenging Nvidia's dominance. - Analysts raised price targets to $230-$265 based on strong GB200 demand, but broader tech market declines highlighted risks in stretched AI valuations. - Upcoming Nov 19 earnings will test Nvidia's ability t

On November 11, 2025, Nvidia's stock experienced a significant drop after SoftBank Group sold its entire $5.8 billion holding in the AI chip giant, causing turbulence across the tech industry. The Japanese conglomerate's full divestment, revealed in late October, sparked speculation about whether its once-bold commitment to artificial intelligence was waning.

SoftBank's $5.8B Withdrawal Raises Questions About AI Growth, Causing Nvidia Stock to Tumble image 0

Nvidia shares slid by 3.1%

to close at $192.41 that day

, representing the steepest single-day loss in several months, even as its market value stayed at $4.85 trillion. This development highlighted increasing investor wariness about high valuations in the AI sector,

with both the S&P 500 and Nasdaq Composite also ending lower

amid broader market jitters.

This downturn continued a trend of volatility for

Nvidia

, whose stock has fluctuated by more than 5% on 19 separate days

in the last twelve months

. Experts pointed to several reasons for the decline: SoftBank's exit, rising geopolitical strains over U.S. chip export rules to China, and intensifying rivalry in the AI chip arena.

The U.S. recently barred Nvidia

from supplying modified Blackwell chips to Chinese buyers, which further dampened investor confidence. At the same time, competitors such as Advanced Micro Devices (AMD) announced intentions to contest Nvidia's leadership,

with AMD forecasting the data-center chip sector could hit $1 trillion

by 2030.

Even with these short-term headwinds, analysts remain guardedly positive. Rick Schafer of Oppenheimer increased his Nvidia price target to $265 from $225, while Christopher Rolland at Susquehanna maintained a $230 target, citing robust demand for Nvidia's GB200 AI products

as noted by Barrons

. Still, the broader retreat from high-growth tech stocks has added to the pressure. The Nasdaq dropped almost 2.5% on November 13, with all seven companies in the Magnificent Seven group seeing losses

according to Barrons

Investors are looking to Nvidia's November 19 earnings release for further insight. The company will need to prove ongoing demand for its Blackwell chips and address ongoing supply issues,

such as setbacks in high-bandwidth memory (HBM) output

. With a trailing price-to-earnings ratio of 56.71 and a forward P/E of 30.30, Nvidia continues to be a central focus for those weighing the long-term promise of AI against immediate uncertainties

as reported by Investing.com

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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