Shares of artificial intelligence (AI) companies, Nano-X (NNOX), Serve Robotics (SERV), and SoundHound AI (SOUN) are taking a significant hit after Nvidia (NVDA) said it has unloaded its stakes in all three on Friday.
The AI chip giant’s 13F filing today resulted in a 12% decline in NNOX, and a much bigger 30% and 43% decline in SOUN and SERV, respectively.
On the flip side, NVDA has built new positions in AI infrastructure company, Nebius Group (NBIS), and a Chinese self-driving technology startup, WeRide (WRD), according to the regulatory filing.
Why Did Nvidia Divest Stakes in NNOX, SERV, and SOUN?
Nvidia has reshuffled its portfolio to cut its exposure to robotics and other AI investments, and focus more on the autonomous vehicle sector.
WeRide has already launched robotaxi services in Abu Dhabi, Guangzhou, and several other cities within China while Nebius Group also has a subsidiary, Avride, that’s currently testing its autonomous vehicles in the U.S. and South Korea.
NVDA may be interested in expanding its footprint in self-driving technology as Statista expects that market to be worth well over $2 trillion by the end of this decade.
Nvidia stock is up just over 1% following its 13F filing on Friday.
NNOX, SERV, and SOUND Were Up Sharply
Nvidia may have opted to divest its stakes in the three AI companies also because their share prices have rallied rather sharply over the past 12 months, albeit more on hype than actual results.
SoundHound, for example, closed its previous session at $15.25, well above its IPO price of $10. The stock is up nearly 400% over the past 52 weeks. Serve Robotics was also up more than ten-fold versus its 52-week low heading into Friday.
That may have made Nvidia decide in favor of taking profit and reallocating capital to areas with stronger growth potential and tangible outcomes.
Nvidia stock itself has nearly doubled in the trailing 12 months.
What to Expect From Nvidia’s Q4 Earnings
Nvidia’s 13F regulatory filling arrives only days before its earnings release scheduled for Feb. 26. The Nasdaq-listed firm is expected to grow its per-share earnings by 61% on a year-over-year basis to 79 cents in its Q4 for fiscal 2025.
Wall Street currently has a consensus “Strong Buy” rating on NVDA, and the mean target of $177.43 indicates potential upside of 30% from current levels.
