What Happened?
Shares of leading designer of graphics chips Nvidia (NASDAQ:NVDA) fell 5.9% in the afternoon session after macro pressure and an impending Senate hearing on China chip sales overwhelmed the impressive product updates earlier in the week.
For those that missed it, the Computex announcements on June 1 were substantive. Jensen Huang confirmed Vera Rubin (Blackwell’s successor) is in full production, with deliveries beginning in Q3 2026 and all three major HBM4 memory suppliers (Samsung, SK Hynix, and Micron) qualified and shipping. He also unveiled RTX Spark, a new AI PC processor developed with Microsoft for the Windows Copilot+ market, a direct move into Intel and AMD’s territory.
However, the same macro force weighing on all high-multiple tech, a stronger-than-expected May jobs report reducing the case for near-term Fed rate cuts, hit Nvidia hard during the session, given the stock prices most of its earnings years into the future. Then reports revealed that Senator Elizabeth Warren invited Jensen Huang to testify before the Senate Banking Committee on June 11 about Nvidia’s China business and export control compliance, a regulatory event now sitting directly in front of investors.
The fundamental Nvidia story is unchanged. Q2 revenue guidance stands at $91 billion, excluding any China data centre contribution. Hyperscalers have committed $119 billion in supply. The China business has been explicitly reset, H20 shipments were zero in Q1 versus $4.6 billion a year earlier, and Q2 guidance bakes in no Chinese data centre revenue, meaning it is now a cleared risk rather than a hidden one.
The Senate hearing on June 11 was the immediate overhang: Warren’s concern is whether Nvidia chips exported to China are being redirected to military applications, a charge the company denies. How Huang navigates that testimony will determine whether China policy risk becomes a structural discount or settles as background noise.
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What Is The Market Telling Us
Nvidia’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock gained 6.3% as over 150 million shares traded hands (well above average) as CEO Jensen Huang’s keynote at Computex in Taipei delivered two major announcements.
