Nvidia stock dropped 2.9% in premarket trading Monday, hitting $NVDA as markets reacted to a weekend of AI safety headlines that rattled the entire chip sector.
The selloff was triggered after Anthropic CEO Dario Amodei published an essay Saturday calling for AI companies to slow the development of their most powerful models. He cited safety dangers and told CBS News that a key hurdle is whether China would join any such pause.
OpenAI CEO Sam Altman added fuel to the fire on Saturday, saying an IPO this year would be “ill-advised.” That spooked investors who had been counting on a major Nvidia windfall from OpenAI’s expected mega-listing.
Nvidia invested $30 billion in OpenAI at a valuation of $730 billion back in February. It also agreed to invest up to $10 billion in Anthropic late last year, when Anthropic was valued at around $350 billion. A delay or cancellation of either IPO would be a direct hit to those positions.
The broader chip market took a beating. Broadcom fell 3.2%, AMD dropped 5.7%, Intel lost 5%, and Marvell Technology slid 7%. It was a rough morning across the board.
The chip selloff did not happen in a vacuum. Nasdaq-100 futures dropped more than 1.5% ahead of Monday’s open, with S&P 500 futures off 0.6%. Asian markets also felt the pain, with South Korea’s Kospi falling 3.26% and Japan’s Nikkei 225 closing down 0.81%.
Oil prices added another layer of stress. WTI crude futures climbed 3% to trade above $103 a barrel after Saudi Arabia shut a key pipeline following drone strikes by Iran-aligned militants in Iraq. Brent futures crossed $108. Energy stocks bucked the trend, with BP and Shell lifting the UK’s FTSE 100 by 0.7%.
The Federal Reserve also opens its September policy meeting this week, with futures markets pricing in about an 86% chance of a rate increase.
Despite the drop, Nvidia is arguably better positioned than its chip peers to weather an AI slowdown. The company has been quietly reducing its reliance on a handful of big customers by backing open-source AI development and investing in start-ups across the ecosystem.
Earlier this month, Nvidia closed a $12.9 billion deal to acquire Hugging Face, the open-source AI development platform. That deal broadens its customer base well beyond the big closed-model labs.
Elon Musk’s SpaceX is also still in the picture. Musk posted Sunday that he was “highly confident” SpaceX would launch Nvidia-powered AI servers in space next year. SpaceX has previously committed to using Nvidia hardware exclusively for its planned orbital data centers.
Musk did post over the weekend that he agreed with Amodei’s call for a slowdown, but stopped short of making any firm commitments to change course.
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