Why Super Micro Computer, Advanced Micro Devices, and Other Artificial Intelligence (AI) Stocks Tumbled on Tuesday

After the market close on Monday, Nvidia (NASDAQ: NVDA) kicked off its annual GPU Technology Conference (GTC), which some have dubbed the “Woodstock of Artificial Intelligence (AI).” Thousands of tech glitterati showed up in person to watch CEO Jensen Huang’s keynote address, while millions more tuned in online.

During the two-hour presentation, Huang expounded on the company’s latest creations, collaborations, and partnerships, which will have a ripple effect across much of the tech world. This morning, investors are still digesting the impact of these announcements, which is causing something of a hangover in AI stocks — likely following the old adage “buy the rumor, sell the news.”

With that as a backdrop, AI-centric server maker Super Micro Computer (NASDAQ: SMCI) tumbled 10.3%, chipmaker Advanced Micro Devices (NASDAQ: AMD) slumped 5%, and chip designer Arm Holdings (NASDAQ: ARM) declined 2.8% as of 1:26 p.m. ET on Tuesday.

A check of all the usual suspects — regulatory filings, financial reports, and changes to analysts’ price targets — was mixed in terms of company-specific news (more on that in a bit), suggesting much of the move was tied to Nvidia’s day in the spotlight.

Image source: Getty Images.

The unveiling of Blackwell

Nvidia announced its long-awaited Blackwell architecture, the successor to the company’s highly sought-after Hopper processors, which have become the gold standard for AI processing. Huang called the updated B200 graphics processing unit (GPU) the “world’s most powerful chip” for AI.

The GB200 superchip combines two B200 processors and a Grace CPU on a single board. Nvidia also developed a new network switch chip — the NVLink — that facilitates speedier communication while reducing the burden on the main processors.

These next-generation processors are being packaged into full systems, including the GB200 NVL72, which contains 36 Grace CPUs and 72 Blackwell GPUs in a complete rack-scale design. The liquid-cooled system also contains a 72-GPU NVLink, which “acts as a single massive GPU,” delivering 30 times faster performance for the…

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