Nvidia’s stock price fell by US$3.21, or 1.06%, to close at US$300.01 in regular trading today. The decline in Nvidia’s share price may be related to the Xi’an epidemic. Samsung disclosed that “affected by the new crown epidemic, we have decided to temporarily adjust the operation of the Xi’an plant.”
The 10-K file submitted by Nvidia to the US Securities and Exchange Commission shows that Samsung is a supplier of Nvidia semiconductor wafers (for example, Samsung is a foundry manufacturer of Nvidia). Investors may worry that production cuts at Samsung's factory will cause Nvidia to cut production.
But this may only be speculation by investors. “South China Morning Post” published an article today that Samsung’s two factories in Xi’an accounted for “15% of global NAND flash memory chips”. In other words, these two factories do manufacture wafers, but the manufactured wafers are used to produce memory chips instead of graphics chips. If this is the case, Samsung’s business of producing graphics chips will not be affected, and the reduction in Samsung’s Xi’an plant may not have any impact on Nvidia. It is true that investors should pay attention to the impact of the epidemic on business operations, but today’s sell-off of Nvidia stock may be an overreaction.
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