Nvidia falls 3% as chip selloff hits AMD and Broadcom

Nvidia shares slid alongside a broad semiconductor selloff Tuesday, though the chipmaker held up better than peers AMD and Broadcom as traders rotated into memory and infrastructure names.

The VanEck Semiconductor ETF (SMH) dropped 2.7% as the broader tech rout deepened, with the Nasdaq 100 falling 2.71% to 29,610.20 and the S&P 500 declining 1.31% to 7,396.80. The Dow Jones Industrial Average eked out a smaller 0.51% decline to 51,635.00, helped by defensive positioning.

"The rotation out of AI chip leaders into memory and infrastructure names reflects a market that's pricing in the next phase of the AI buildout," said Sarah Lin, equity strategist at Edgen. "Nvidia's relative outperformance suggests investors still see it as the core beneficiary, but the near-term momentum has clearly shifted."

Nvidia shares have gained about 12% in 2026, sharply trailing the SMH's roughly 84% surge. The stock has lost about 3% in the past month as Wall Street's focus shifted toward memory chip makers like Micron Technology and Sandisk, both up nearly 60% in the past month alone. Nvidia traded near $208, roughly 11% below its 52-week high of $236.26, with a forward price-to-earnings multiple of 23 — the lowest among Magnificent Seven AI names despite revenue growth accelerating to 85%.

The selloff coincided with declining prices for Nvidia's B200 GPU computing power. The cost to rent B200 compute fell to $4.22 per hour on June 21 from a three-month high of $6.11 on May 30, according to Ornn, which tracks live GPU pricing. Traders on Kalshi are betting the compute price will not surpass May's high by the end of the second quarter, reflecting uncertainty about near-term demand for AI computing capacity.

The U.S. 10-year Treasury yield edged higher, while the dollar index held steady, offering no relief for growth stocks. The Cboe Volatility Index rose, reflecting increased hedging demand as the tech-heavy Nasdaq led the broader market lower.

Despite the near-term headwinds, analysts remain broadly bullish on Nvidia. The consensus price target stands at $299, implying roughly 44% upside from current levels, with 95% of analysts rating the stock a buy. RBC Capital Markets said after Google's agreement to pay SpaceX $920 million a month for Nvidia GPU capacity that the chip giant "looks best positioned among peers" for the second half of 2026 and 2027.

This article is for informational purposes only and does not constitute investment advice.