Why Didn't the Market Buy into NVIDIA's GTC Conference This Time?

The tech world was abuzz with anticipation as NVIDIA's annual GPU Technology Conference (GTC) kicked off in San Jose. CEO Jensen Huang's keynote address was expected to be a game-changer, unveiling the company's latest innovations and roadmap for the future. However, the market's initial reaction was underwhelming, with NVIDIA's stock dropping 5% over two days. So, what went wrong?

The broader market downturn certainly played a role. Investors were already jittery, and the tech sector was feeling the pinch. But the lackluster response to Huang's keynote was surprising. The CEO laid out an impressive roadmap, announcing the launch of new AI chips like the Blackwell Ultra, Vera Rubin, and Vera Rubin Ultra, and projecting that data center spending on compute hardware could reach $1 trillion. Yet, the market seemed unimpressed.



One possible explanation is that investors are growing skeptical about long-term AI demand. The efficiency of AI models is improving, which could reduce the need for high-end GPUs like NVIDIA's. This concern was reflected in the market's initial reaction to the GTC conference.

However, the story didn't end there. As Wall Street analysts digested Huang's presentation, their optimism began to shine through. Citi analyst Atif Malik reiterated his Buy rating on NVIDIA stock, calling the company the "king of the hill" and setting a $163 price target. Raymond James analyst Srini Pajjuri also maintained his Strong Buy rating, citing NVIDIA's impressive roadmap and technology innovation.

The analysts' bullish outlook helped to reverse the initial market reaction, with NVIDIA's stock rising more than 2% on March 21, 2025. The company's announcements at the GTC conference, including the launch of new AI chips and quantum computing initiatives, aligned with market expectations and addressed investor concerns.



The launch of new AI chips provided a clear roadmap for future AI hardware, reassuring investors about NVIDIA's leadership in the market. Huang's projection that data center spending on compute hardware could reach $1 trillion also provided a bullish outlook, countering concerns about long-term AI demand.

The focus on quantum computing initiatives, such as the NVIDIA Accelerated Quantum Computing Research Center (NVAQC), also aligned with market expectations for innovation in this rapidly evolving field. The center's integration of quantum hardware with AI supercomputers to enable accelerated quantum supercomputing addressed challenges such as qubit noise and transforming experimental quantum processors into practical devices, positioning NVIDIA at the forefront of quantum computing research.

In conclusion, while the initial market reaction to NVIDIA's GTC conference was underwhelming, the company's announcements ultimately aligned with market expectations and addressed investor concerns. The launch of new AI chips and quantum computing initiatives provided a clear roadmap for future growth, reassuring investors about NVIDIA's leadership in the tech sector. As the market continues to evolve, NVIDIA's focus on innovation and technology will be key to its success.