What Happened?
Shares of leading designer of graphics chips Nvidia (NASDAQ:NVDA) jumped 2.8% in the afternoon session after industry giant Taiwan Semiconductor Manufacturing Co. posted stronger-than-expected quarterly results, fueling optimism about sustained demand for artificial intelligence (AI) hardware.
As the world's largest contract chipmaker, TSMC's performance is often seen as a key indicator for the entire tech industry. The company reported record fourth-quarter revenue, surpassing Wall Street estimates, driven by robust demand for advanced chips used in AI applications.
This positive report created a ripple effect across the sector, boosting shares of other semiconductor companies and equipment suppliers like ASML, Nvidia, and AMD. Investors are interpreting TSMC's success and its plans to increase capital spending as a strong signal that the AI-driven upcycle for semiconductors is resilient and likely to continue.
The shares closed the day at $187.11, up 2.1% from previous close.
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What Is The Market Telling Us
Nvidia’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 27 days ago when the stock gained 3% after Reuters reported the Trump administration officially launched a multi-agency review that could greenlight the first shipments of Nvidia’s H200 AI chips to China.
This procedural milestone signals a concrete step toward fulfilling President Trump’s pledge to reopen the Chinese market, which Nvidia CEO Jensen Huang previously estimated at billions of dollars in potential revenue. Also, Tigress Financial raised its price target on the stock to $350 and repeated its "Strong Buy" rating, pointing to the company's lead in AI infrastructure and data-center computing. Adding to the bullish sentiment, a Bernstein analyst noted that the stock looked "unusually cheap" and maintained an Outperform rating.
Nvidia is flat since the beginning of the year, and at $187.44 per share, it is trading 9.5% below its 52-week high of $207.04 from October 2025. Investors who bought $1,000 worth of Nvidia’s shares 5 years ago would now be looking at an investment worth $14,576.
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