Nvidia's Strong Fundamentals May Not Save It from Seasonal Weakness

Nvidia, the dominant force in artificial intelligence infrastructure, recently reported its fiscal 2027 second quarter results. The company's revenue surged 106% year-over-year to $96.2 billion, beating Wall Street forecasts.

The stock has climbed about 8% since the announcement through August 28, but investors may want to be cautious in September. Historical data shows that Nvidia shares have posted an average decline of 0.8% during this month over the past decade.

This weakness comes at a time when macroeconomic headwinds are already present. Inflation remains high, and there is still a possibility of the Federal Reserve raising interest rates before year-end, which could pressure equity valuations.

Nvidia's fundamentals, however, indicate a different story. The company continues to dominate AI infrastructure demand for its data center chips, with no signs of softening in this area. Bears who bet against Nvidia have been repeatedly punished as the stock soared 901% over the past five years.