Short answer: yes, the pullback likely creates tactical upside, but only if you separate execution risk (short term) from structural demand risk (long term). Right now, the market is repricing the former, not yet the latter.

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1. Why the market reacted so sharply

The selloff reflects a shift from perfect-execution expectations to normal semiconductor execution risk:

a) Blackwell rollout delay

Nvidia was priced for flawless transition from Hopper → Blackwell.

Any delay compresses near-term revenue recognition and pushes hyperscaler deployments slightly outward.

Markets discount timing aggressively even if demand remains intact.

b) AI capex sustainability fears

Investors are questioning whether hyperscalers move from “capacity land-grab” to ROI discipline in 2026.

This is a sentiment risk, not yet a demand collapse. Backlogs and commitments remain extremely large.

c) Custom silicon narrative

Meta, Google, Amazon designing in-house chips creates headline fear.

However, most custom ASICs target specific inference workloads, not full-stack training ecosystems where Nvidia still dominates.

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2. Have the key risks actually been resolved?

Partially addressed, not fully eliminated.

✔ Addressed / improving

Demand visibility: Order pipelines and multi-year AI infrastructure buildouts remain intact.

Software moat: CUDA + networking + system integration still form a high switching cost.

Customer concentration risk: expanding enterprise and sovereign AI demand diversifies beyond hyperscalers.

✖ Still unresolved

Execution timing risk: Blackwell ramp must prove smooth in the next 1–2 quarters.

Gross margin trajectory: New architectures typically pressure margins early.

Capex psychology: Markets need proof AI spend converts into revenue growth for customers.

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3. Why this pullback may create upside

The key insight: valuation compression occurred without a structural demand break.

Historically, Nvidia corrections during major compute transitions:

reset positioning,

flush momentum leverage,

and allow long-term buyers to re-enter before the next deployment wave.

If Blackwell shipments accelerate into large-scale deployment cycles, earnings power shifts forward again.

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4. What the market is really waiting for now

Three confirmation signals matter more than headlines:

1. Blackwell shipment scale, not announcements.

2. Hyperscaler capex guidance staying elevated into 2026.

3. Inference growth proving AI monetisation is real, not experimental.

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Bottom line

The pullback looks less like a thesis break and more like a transition reset. Risks are not fully cleared, but they have shifted from existential to executional. If AI infrastructure spending merely normalises rather than collapses, the recent decline likely opens asymmetric upside over a multi-quarter horizon rather than signalling a peak cycle.