Nvidia stock dropped 2.94% on Thursday to close at $230.48, coming off its Tuesday record high of $243.37 by approximately 5%. The decline followed reports that OpenAI informed investors its annualized revenue stands at roughly $50 billion, which is $18 billion below the $68 billion figure reported last month.
OpenAI Revenue Discrepancy Shakes Tech Stocks
Speaking on CNBC's Closing Bell, Alex Kantrowitz, founder of Big Technology, described the discrepancy as largely an accounting issue. However, chipmakers and AI infrastructure providers tied to OpenAI felt immediate downward pressure. Advanced Micro Devices (AMD) slid 3.9% on Thursday, while Oracle stock dropped over 5% during the revenue-linked selloff.
Despite Thursday's decline, Yahoo Finance data indicates Nvidia remains up roughly 24% year-to-date with a market capitalization near $5.6 trillion. Fundamentals for the chipmaker remain elevated, with Google Finance data showing Nvidia reported $96.22 billion in revenue last quarter, beating analysts' estimates of $92.16 billion.
Key details from Thursday's market movement include:
- Nvidia closed at $230.48 (-2.94%), down from its $243.37 record high.
- OpenAI annualized revenue confirmed at $50 billion versus $68 billion previously reported, creating an annualized revenue gap.
- AMD dropped 3.9%, while Oracle tumbled more than 5%.
- Nvidia posted last quarter revenue of $96.22 billion, exceeding the $92.16 billion consensus.
Market Concentration and Upcoming AI IPOs
Kantrowitz noted growing nervousness around the AI trade, highlighting that some corporate buyers have begun shifting capital toward standard software models rather than expensive frontier models. Market breadth remains concentrated, with the top seven equities outpacing the remaining 493 stocks in the S&P 500, while tech equities now account for more than 40% of total market value.
Looking ahead, Kantrowitz expects an initial public offering (IPO) from Anthropic within weeks, pointing to a leaked S-1 regulatory filing showing corporate losses outpacing revenue gains. OpenAI is expected to file for an IPO next year. Conversely, Wedbush analyst Dan Ives named Nvidia among his top five technology picks for 2027, arguing that investors are underestimating a $4 trillion AI infrastructure spending trend.
Why It Matters
The market reaction underscores how heavily public equity valuations rely on private AI startup benchmarks. Because mega-cap semiconductor companies like Nvidia and AMD rely on multi-billion dollar hardware partnerships with OpenAI and Anthropic, any slowdown or accounting adjustment in software revenues immediately triggers re-pricing across hardware suppliers. Upcoming IPO filings from Anthropic and OpenAI will serve as the ultimate test of whether software monetization can justify the trillions allocated to hardware infrastructure.
