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Nvidia’s slump continues even after Jensen Huang softens his statement that “China is going to win the AI race”

Different words, same message.

11/6/25 8:16AM

Nvidia ended Wednesday’s session with a late-day drubbing, which was followed by an article from the Financial Times in which CEO Jensen Huang said, “China is going to win the AI race” because its regulatory environment and ability to access power is more supportive of the industry’s growth.

Nvidia’s official newsroom account on X put out a softened, more sanitized statement attributed to Huang on this topic hours later on Wednesday evening:

“As I have long said, China is nanoseconds behind America in AI. It’s vital that America wins by racing ahead and winning developers worldwide.”

To translate: the AI race between the US and China is tight, and it’s vital that America wins by winning.

The unwritten subtext is still the same: “China is going to win the AI race” — without having access to Nvidia’s flagship GPUs, or even wanting its nerfed chips!

Shares of the chip designer are down 1.7% as of 10:36 a.m ET.

It’s interesting thinking through who Huang’s audience for both sets of remarks is. The initial statement is likely aimed at the Trump administration in a bid to reinforce the urgency of the power demands of the AI boom.

The administration appears to have already been moving in this direction, with US Energy Secretary Christopher Wright reportedly looking to speed the approval process for data centers to connect to the power grid.

Microsoft CEO Satya Nadella recently said his biggest problem today is “not a supply issue of chips; it’s actually the fact that I don’t have warm shelves to plug into.”

The second statement is likely aimed at quelling alarm from anyone worried too much about the first statement!

Two things can be true, I suppose: China may be poised to race ahead of the US in AI, as Huang warned, and Nvidia’s business in China getting turfed has not stopped the chip designer from being the biggest AI-linked stock market winner. Last week, Nvidia noted that it’s received more than $500 billion in orders for its Blackwell and Rubin chips through 2026.

After the Trump administration banned the sale of Nvidia’s H20 chips to China, Jensen Huang spent a lot of time trying to convince President Trump of the importance of companies around the world (China included!) operating on his company’s CUDA software platform. Those efforts bore fruit, as export restrictions were lifted. But in the process of trying to win over hearts and minds, Huang may have also convinced Chinese President Xi as well, spurring renewed efforts from China to bolster its domestic AI capabilities in both hardware and software and shift away from Nvidia’s offerings.

(As an aside, Wednesday’s late-day slump in Nvidia had all the makings of a “someone knows something” move: though the FT story in question wasn’t published until 4 p.m. ET, shares of the chip designer were soft throughout the last hour of trading, with selling accelerating 10 minutes ahead of the close.)

Matt Phillips2h

‘Golden age of profit margins’ seen in 2026

Wall Street tends to be a pretty optimistic place. But on one measure, market watchers are the most optimistic on record.

FactSet data shows the consensus estimate for S&P 500 net profit margins in calendar year 2026 calls for the gauge to climb to 13.9% in 2026.

But if borne out by events next year “it will mark the highest (annual) net profit margin reported by the index since FactSet began tracking this metric in 2008,” wrote John Butters, senior earnings analyst at the financial data company.

A recent story from Barron’s also commented on the expectations for especially fat profit margins embedded into forecasts for next year.

“We are in the golden age of margins,” RBC’s Capital Markets’ head of US equity strategy, Lori Calvasina, told the magazine.

That’s good news for investors looking forward to next year. But the follow up question, of course, is where the growth in profitability is expected to come from. The answer, as you might have guessed, is tech. Though the precise mechanisms by which those profits land in the coffers of the giant tech firms remains something of a mystery. Barron’s doesn’t get into the details, saying “call it benefits from AI, pricing power, or whatever.”

That doesn’t exactly sound like money in the bank. But even die-hard haters of AI have to acknowledge that betting against the ability of giant tech companies to generate massive profit growth has been a bad trade for the last couple decades.

The Stock Market Needs to Focus on Lucky 13

A recent story from Barron’s also commented on the expectations for especially fat profit margins embedded into forecasts for next year.

“We are in the golden age of margins,” RBC’s Capital Markets’ head of US equity strategy, Lori Calvasina, told the magazine.

Luke Kawa3h

Opendoor rises after CEO Kaz Nejatian touts an explosion in its home-buying footprint

Opendoor Technologies gained in early trading after CEO Kaz Nejatian touted an explosion in the company’s home-buying footprint.

In a message on X, the former Shopify COO posted two maps: one of which depicts a fairly limited area in which the online real estate company would buy or sell homes, and the second of which suggests that has now expanded to include the entire lower 48:

Big launch week at @Opendoor.

ZIP codes where @Opendoor buys homes. pic.twitter.com/UplMd4sXJE
— Kaz Nejatian (@CanadaKaz) December 22, 2025

In a follow-up tweet, Nejatian attributed the gains to AI, writing, “First pic took 10 *years* of work without AI. Second pic took 10 *weeks* of work with AI.”

On his first earnings call as CEO, Nejatian said the company had adopted a “default to AI approach.”

One of his first pledges was to launch Opendoor everywhere in the lower 48.

Max Knoblauch3h

Hertz surges on bullish options activity

As millions begrudgingly make their way to the rental car counter amid the winter holidays, investors are pouring into calls and sending Hertz stock soaring.

As of 10:51 a.m. eastern, Hertz had seen 17,861 calls traded. That’s already significantly ahead of the 20-day average volume of 12,956. Hertz shares are up more than 12%.

Seemingly juicing the rally was a post on X that read “car rental companies could end up being the picks and shovels of autonomy” that was reposted by billionaire Bill Ackman, whose hedge fund is one of Hertz’s largest shareholders.

If Hertz’s price action holds, the move will mark its ninth-best trading day of 2025.

Luke Kawa3h

POET Technologies jumps on elevated call activity

Optical communications company POET Technologies is up double digits in early trading on Monday as this potential supporting player in the AI boom gets a bid from the options market.

Just an hour after the opening bell sounded, call volumes are already running well above their five-session average for a full day.

The stock became a retail favorite in early Q4 right before many speculative trades began to retreat, with record call volumes of nearly 600,000 on October 7. The last big bump in options activity came on December 3, the session after Marvell’s acquisition of Celestial AI, a customer of POET, offered some validation for its technology as a data center solution.

Max Knoblauch4h

Nintendo dips after GameStop says the “Mario Kart World” bundle will stop being produced

Nintendo’s popular bundle that packaged the Switch 2 with “Mario Kart World” is seemingly going out of production, per a post on X from GameStop.

Shares of the console maker fell more than 3% after markets opened on Monday, implying some worry from investors that consumers may not be so willing to pay the game’s elevated $80 price tag (it’s valued at $50 in the bundle). About 9.6 million copies of the game have sold since the Switch 2 released in June, a figure that includes the bundled version.

The Switch 2 itself is still looking solid, sales-wise. It was pacing 68% ahead of the original Switch in October, though November saw a sharp market-wide spending drop-off on consoles according to data from Circana. Sony’s PS5 outsold the Switch 2 in both units and dollars last month.