By Daniel Sparks
Publication Date: 2025-12-22 21:06:00
Nvidia stock has soared this year. But has it gotten ahead of itself?
After a transformational 2024 for Nvidia‘s (NVDA +1.51%) business and its stock, momentum has persisted as the AI (artificial intelligence) boom accelerated. The year has confirmed Nvidia’s leadership position in AI chips as its data center segment has grown to represent the majority of its business, and demand for its most powerful products continues to exceed supply.
There’s a lot to like about the tech company, which designs graphics processing units (GPUs) and related systems that power AI computing. In fact, Nvidia has seen its growth reaccelerate in its most recent quarter.
But has the stock soared too high, making shares unattractive even though the business is firing on all cylinders?
I think so.
Here are three reasons I’m not interested in buying Nvidia at its current price.
Image source: Getty Images.
Customer concentration risk
Highlighting the explosive demand for its products, Nvidia’s revenue grew 62% year over year in its third quarter of fiscal 2026 (the quarter ending Oct. 26, 2025) after 56% year over year growth in fiscal Q2.
That kind of growth, however, depends heavily on a small group of customers. In its quarterly report for fiscal Q3, Nvidia said one direct customer accounted for 22% of total revenue, another represented 15%, and two more customers each exceeded 10%. Even more, this concentration risk has been rising; for the year-ago quarter, the company disclosed its three…
