Nvidia shares declined 4.2% after the company’s recent guidance failed to meet Wall Street forecasts, prompting a sell-off despite robust AI demand.

Microsoft, Amazon and Google collectively boosted their AI infrastructure budgets by 30% year-over-year, allocating over $12 billion to cloud services and custom AI servers.

Analysts warn that while demand for AI chips remains strong, concerns over valuations and supply chain constraints could keep Nvidia’s stock under pressure in the near term.