Nvidia's Stock Falls After Record High

Nvidia, the chip maker, experienced a slight decline in its stock price after reaching a record closing high the previous day. However, the disclosure of its investments in other companies caused stocks like SoundHound AI to surge.

Pre-market Trading Results

During premarket trading, Nvidia's shares were down 0.3%, reaching $736.97.

Impressive Closing Numbers

On Wednesday, the stock closed with a 2.5% increase at $739. As a result, Nvidia's market capitalization rose to $1.825 trillion, making it the third-largest company in the US. It surpassed Alphabet, the parent company of Google, which had a valuation of $1.821 trillion.

Focus on Upcoming Earnings Report and Growth in Chip Stocks

Investors have been closely following Nvidia in anticipation of its upcoming earnings report on February 21. The company has been rallying alongside other chip stocks due to the growing demand for semiconductors in artificial intelligence and other advanced technologies.

Nvidia's Investments in Other Companies

Nvidia has been actively investing in AI development. Recently, the company disclosed its holdings in several companies:

• SoundHound AI: Nvidia owned approximately 1.7 million shares of this voice-based technology company as of December last year, valued at around $3.7 million at that time. In premarket trading on Thursday, SoundHound shares surged by 78% to $4.02.

• Arm Holdings: Nvidia included investments in this chip designer in its filing.

• Nano-X Imaging: This medical-imaging developer also received investments from Nvidia.

• Recursion Pharmaceuticals: Lastly, Nvidia disclosed its investments in this drug development company.

The market responded positively to these investments, with shares of SoundHound AI, Nano-X Imaging, and Recursion Pharmaceuticals surging during premarket trading.

Predicting the Impact of Nvidia's Association

Nvidia's association with other companies has the potential to greatly impact their stock prices. However, it also comes with the risk of a potential pullback as the initial hype fades. For example, Beamr Imaging stock declined by 11% in premarket trading on Thursday, despite experiencing a six-fold increase since announcing joint research with Nvidia on automated video modernization earlier this week.