Jensen Huang is not concerned about last week’s chip selloff. He sees it as a positive. NVIDIA shares rose 2.3% in premarket trading on Monday, recovering some of Friday’s 6.2% drop. Speaking to reporters in South Korea, the CEO said investors should welcome the pullback because it offers a chance to buy shares at a lower price. Below is a look at Huang’s comments, the new partnerships announced over the weekend, and why Nvidia’s valuation is drawing more attention.
Friday’s selloff was not unique to Nvidia. Weak guidance from Broadcom and worries about higher interest rates led to a broad decline in semiconductor stocks. NVIDIA dropped 6.2% as investors pulled back from the sector, not because of any specific issue with the company. In Seoul, Huang responded directly, telling reporters that no matter what happens in the market, investors should be pleased because shares are now available at a lower price.
The valuation numbers support Huang’s point. According to FactSet, NVIDIA’s forward price-to-earnings ratio is now about 20, down from around 26 when the stock was last seen as undervalued. For a company with Nvidia’s revenue growth, a forward multiple below 21 is unusually low. The recent selloff has made an already cheap stock even more affordable.
Two new deals announced over the weekend reinforced the underlying demand story. SK Hynix and Nvidia confirmed a multiyear technology partnership to jointly develop the next generation of memory for AI infrastructure, building on Nvidia’s certification of SK Hynix as a provider of HBM4 high-bandwidth memory. Separately, SK Telecom announced an agreement with Nvidia to develop gigawatt-scale AI cloud services in South Korea, with plans to expand the initiative into other parts of Asia. SK Telecom’s American depositary receipts rose 3.5% in premarket trading on Monday after falling 8.7% on Friday.
Nvidia’s trip to South Korea is part of a larger effort to strengthen ties across the Asian tech supply chain. Both deals were announced during Huang’s visit, showing that demand for AI infrastructure hardware and services is growing in several regions at once.
