When Chips Fall This Much, We Think Opportunity Follows

Author

Noah Zelvis
September 05, 2025

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Wall Street isn’t known for patience, and one AI hardware name is feeling the sting.

After issuing modest guidance and admitting to some “nonlinear” demand, shares cratered nearly 20%.

But with custom silicon demand rising and long-term growth intact, the selloff may be setting up a sharp rebound.

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AI

Nvidia Keeps China Hungry With H20 Chips and Eyes on B30A

Nvidia (NASDAQ: NVDA) continues to dominate the wish list of Chinese tech giants like Alibaba, ByteDance, and Tencent.

Despite pressure from regulators, the H20 chip remains the go-to choice because rivals cannot deliver the same performance.

Domestic suppliers such as Huawei and Cambricon are still struggling to compete.

For firms racing to train larger AI models, reliability matters more than politics, and Nvidia keeps winning that race.

The B30A Tempts With Raw Power

The spotlight is shifting to Nvidia’s upcoming B30A, which insiders say could pack up to six times the muscle of the H20.

Early price talk puts the chip around $20,000, nearly double the H20, yet still attractive for companies chasing faster model training.

Billions Ride on the Chip Pipeline

China accounted for 13 percent of Nvidia’s revenue last year, a slice worth billions in a market still hungry for AI capacity.

The company is reportedly sitting on as many as 700,000 H20 chips, positioning itself to meet demand head-on.

The logic is simple. Every chip shipped reinforces Nvidia’s software ecosystem, making it harder for competitors to catch up.

That lock-in, more than hardware specs alone, is Nvidia’s true advantage.

Semiconductors

From Chips to Cars and Jets, Cadence Expands With $3.16 Billion Hexagon Deal

Cadence (NASDAQ: CDNS) is reaching across the Atlantic with a $3.16 billion deal to scoop up Hexagon AB’s design and engineering business.

The package: 70% in cash, the rest in stock.

The goal: expand beyond traditional chip clients and pull aerospace and automotive giants into its orbit.

Why It Matters

Cadence is already the go-to name in electronic design automation — its tools are how Nvidia and Qualcomm make sure chips don’t ship with bugs baked in.

Hexagon’s software, on the other hand, tackles structural and multibody dynamics simulation. 

Think cars, planes, and engines being stress-tested virtually before anyone cuts real metal.

Big Numbers, Bigger Reach

Hexagon’s D&E unit pulled in nearly €265 million in 2024 revenue and employs over 1,100 people worldwide. Customers include Volkswagen, BMW, and Lockheed Martin.

With that lineup, Cadence isn’t just doubling down on chips; it’s expanding into the heavy industries that keep supply chains humming.

Looking Ahead

The deal is slated to close in early 2026, with a €175 million reverse break-up fee hanging over it. It follows Cadence’s $1.24 billion BETA CAE Systems buyout last year.

Together, these acquisitions show a company intent on being more than just chip software, as Cadence wants to be the digital toolkit for engineering itself.

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Transportation

Waymo Expands Its Runway, Robotaxis Cleared for Takeoff in San Jose

Waymo just secured clearance to run robotaxis at San Jose Mineta International, marking its first California airport service.

Testing begins in the coming months, with commercial rides expected by year’s end.

A Long Road to the Terminal

Airports have been a stubborn hurdle. San Francisco pushed back in 2023, leaving Waymo circling the runway.

But Phoenix cracked the code, where Sky Harbor became its busiest hub, moving from curbside pilots to 24/7 operations in less than a year.

Scaling the Fleet

Waymo now counts more than 2,000 vehicles nationwide, with nearly 800 in the Bay Area alone. Expansion maps are dotted with cities like Denver, Seattle, Dallas, and Miami, while New York just signed off on testing.

The playbook is clear: airports are the next battleground for autonomous adoption.

The Takeaway

What once felt like sci-fi airport shuttling is edging into reality.

Waymo’s San Jose debut doesn’t just move passengers, it moves the timeline forward for autonomous mobility in high-stakes, high-traffic environments.

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Recent Tech Movers

Broadcom (NASDAQ: AVGO)

Broadcom continues to execute as one of the most consistent names in semiconductors. In Q3, the company posted $16 billion in revenue, up 22% year-over-year, with EPS of $1.69, beating expectations.

AI chip sales surged 63% to $5.2 billion, and Q4 revenue guidance was raised to $17.4 billion.

CEO Hock Tan emphasized Broadcom’s rising dominance in networking tech, noting the “network is the computer.”

Free cash flow came in at a robust $7 billion, and the company is on pace to surpass $20 billion in AI-related revenue this year.

While the stock trades near 52-week highs, the combination of high margins (78.4%) and long-term visibility in AI and networking makes Broadcom a cornerstone of enterprise infrastructure.

Amazon (NASDAQ: AMZN)

Amazon shares are rebounding after AI startup Anthropic, in which it holds a major stake, closed a $13 billion funding round.

Barclays estimates the startup could add up to 400 basis points of quarterly growth to AWS.

Anthropic’s Claude models are trained on Amazon’s Trainium and Inferentia chips, creating a strong revenue loop for AWS.

At the same time, Amazon is expanding same-day grocery delivery and advancing its satellite internet ambitions.

With AMZN stock up 7% YTD and AI fueling multiple business lines, this could mark the start of an earnings reacceleration.

Affirm (NASDAQ: AFRM)

Affirm soared 10% after smashing fiscal Q4 expectations. EPS came in at $0.20, nearly double analyst forecasts, and revenue rose 33% to $876 million.

The firm’s key volume metric jumped 44% year-over-year, aided by strong partnerships with Amazon and Shopify.

CEO Max Levchin called the results a sign the company is “firing on all pistons.”

With 0% APR loans surging and the Affirm Card gaining traction, in-store GMV rose 187% while active cardholders nearly doubled.

Affirm’s upbeat guidance for fiscal 2026 suggests momentum is building as BNPL adoption broadens.

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The Setup is From Selloff to Setup

Marvell Technology (NASDAQ: MRVL) is no stranger to market volatility, but the recent 18% selloff may be an overreaction.

The chipmaker’s Q2 revenue of $2.01 billion matched expectations, and EPS landed at $0.67, above the $0.66 forecast.

Yet guidance for Q3 revenue of $2.06 billion fell slightly short of the $2.11 billion estimate, triggering a steep drop in the stock price.

So why the harsh reaction? Management flagged “lumpiness” in custom AI chip demand from cloud providers like Amazon and Microsoft, which dominate Marvell’s data center segment.

But this is a timing issue, not a structural one. Q4 is expected to be “substantially stronger,” and long-term demand for custom silicon remains intact.

CEO Matt Murphy acknowledged that nonlinear orders are par for the course in infrastructure buildouts.

And while some analysts, like those at Bank of America, downgraded the stock on near-term concerns, others are calling this dip a buying opportunity.

Morningstar maintained a $90 fair value estimate, citing confidence in Marvell’s AI chip roadmap.

Marvell’s optical interconnect and custom accelerator businesses are both set to benefit from ongoing investment in AI infrastructure.

In Q2, revenue rose 58% year-over-year, a record for the company, and net income flipped from a loss to a $194.8 million profit.

While Wall Street is clamoring for more detail on customer wins, the fundamentals remain strong.

With the stock now down 43% YTD, investors may be overlooking a name that still holds a key seat at the AI hardware table.

If management executes and Q4 demand rebounds as projected, this drawdown could turn into one of the more compelling second-chance stories in semis.

Everything Else

  • 🤝 Reliance Industries is partnering with Google and Meta to supercharge India’s AI ecosystem and digital infrastructure buildout.

  • 👥 Two unnamed customers accounted for nearly 40% of Nvidia’s Q2 revenue, sparking fresh speculation over hyperscaler dependence.

  • 🧑‍💼 Generative AI is disproportionately impacting entry-level U.S. jobs, with younger workers facing growing disruption, according to a new Stanford study.

  • 🚧 Trump’s latest tariff plan targets chipmakers that fail to shift production to the U.S., raising concerns over trade fragmentation.

  • 💼 Cadence Design Systems has struck a $3.16 billion deal to acquire Hexagon’s design unit, expanding its reach into simulation and engineering software.

That's our coverage for today; thanks for reading! Reply to this email with feedback or any tech stocks you want me to check out.

Best Regards,
—Noah Zelvis
Tech Stock Insider