For questions about this article or underlying research, email help@trefis.com.
Shares of NVIDIA (NVDA) have lost 13.6% over the past month, while the S&P 500 lost 2.3%. Investors holding through the decline are likely betting that a wider market sell-off would pass quickly for NVIDIA, and that its unusually high profit margin will hold. So how deep have NVIDIA's falls been when the whole market turned, and how long did they last?
How Far Has NVIDIA Stock Fallen In Market Shocks?
During a typical market shock, NVIDIA stock has fallen further than the S&P 500, and those declines have not always passed quickly. The company experienced its worst shock-driven drop since 2007 during the 2008-2009 financial crisis. NVIDIA lost 84% in that period, while the S&P 500 lost 53%. The stock also shed 63% in the 2022 inflation shock, against a 24% decline for the index. Across all the market shocks since 2007 , the stock fell 28.1% on average, compared with 15.8% for the S&P 500.
Measured from its lowest close, NVIDIA stock returned to its earlier high in a median of 1.6 months. Two recoveries took far longer. The stock needed 13.7 months to bounce back from the late-2018 growth scare, a period when it fell 56% against 19% for the S&P 500. It took 88 months, more than seven years, to recover from the 2008-2009 crisis.
NVIDIA Is At Its Most Profitable In Ten Years
So far, NVIDIA's margin is holding, and sales are growing alongside it. Revenue reached $303 billion over the four quarters to July 2026, up 83.4% from a year earlier. The company posted an operating margin of 65.2% over those twelve months, up from 58.1% a year before. No quarter end in the past ten years shows a higher operating margin.
Debt has grown much faster than the business. Total debt for NVIDIA stood at $38.4 billion at the end of July 2026, up from $10.6 billion a year earlier. The company still covered that debt with its cash and short-term investments of $62.5 billion.
Where Is NVIDIA Under Pressure Now?
Management's own outlook, provided on the August 26, 2026 earnings call, already sets one market aside. That forecast includes no China data center compute revenue, given what management called ongoing geopolitical uncertainty. Shipments of Hopper 200 products to customers in China accounted for less than 1% of NVIDIA's data center revenue in fiscal Q2 2027.
NVIDIA is also putting its own balance sheet behind some customers. Management said the company has invested nearly $50 billion in frontier AI labs. The company expects demand from the labs it backs this way to make up roughly a quarter of its business in fiscal 2028, and management said it knows some will call this circular financing.
Customers are also taking longer to pay. Management said NVIDIA's days of sales outstanding, the time it takes to collect on a sale, rose to 60 days in fiscal Q2 2027, reflecting extended payment terms for large purchases.
Margins at NVIDIA also face pressure from memory. Management said memory prices have risen more than it expected and are still heading higher. The company guided gross margin to 74%, plus or minus half a point, for fiscal Q3 2027, against 75% in fiscal Q2. Management expects margins to bottom at 71% to 72% in fiscal Q4, before settling at 72% to 73% in fiscal 2028 as its price increases take effect. Gross margin is the figure to watch when NVIDIA reports its fiscal Q3 2027 results in November 2026.
How Much NVIDIA Do You Already Own?
If you own an S&P 500 or Nasdaq fund, you already own NVIDIA, alongside the same few giants that lead those funds. The Trefis High Quality (HQ) Portfolio takes a different route: 30 quality companies in equal weight, so no single stock dominates. Since its inception in September 2020 it has returned 105%, ahead of a benchmark that combines the S&P 500, S&P Mid-cap and Russell 2000.
See How The HQ Portfolio Works
Spot an error or want more like this? Tell us in 10 seconds .
