Is the fever for AI stocks in the US cooling down? NVIDIA Corporation (NVDA.US) and Salesforce, Inc. (CRM.US) financial reports have left investors feeling "chilled".

After the recent intense volatility in the US stock market, investors have been eagerly awaiting NVIDIA Corporation's (NVDA.US) financial report to inject new vitality into the AI sector, but the reality did not meet expectations. The performance of this chip manufacturing giant failed to excite the market, as its profits, while exceeding expectations, did not match its past impressive performance, and its outlook for the next quarter was a mixed bag. While NVIDIA Corporation did alleviate some of the pressure on its stock price since the rise of the AI startup DeepSeek earlier this year, the significant question of whether AI investment can continue remains unresolved. Following the release of the financial report, NVIDIA Corporation's stock price only slightly rose by about 1% in pre-market trading on Thursday. "A few months ago, we were very confident about the growth prospects of AI," said Brian Mulberry, portfolio manager for Zacks Investment Management's clients. "Now, market expectations have become more scattered, and the volatility of related AI stocks is beginning to reflect this." The outlook for the AI services sector is even more uncertain. Salesforce, Inc. (CRM.US), which launched the so-called AI agent "Agentforce" last year, saw a pre-market drop of over 3% after providing disappointing performance expectations. The company stated that the contribution to revenue from "Agentforce," which aims to complete tasks like customer service without human guidance, is expected to be limited this year. "Salesforce, Inc. seems to be facing some difficulties," said Chris Brigati, Chief Investment Officer at SWBC. The financial reports of NVIDIA Corporation and Salesforce, Inc. suggest that the "AI boom may not be as strong as in 2023 or 2024, despite still maintaining overall positive momentum and some growth potential." However, Brigati still sees NVIDIA Corporation's market leadership in the AI field favorably and believes that any pullback in the stock could be a buying opportunity. At the time of these financial reports, the AI sector is in a delicate period. The rise of lower-cost AI models like DeepSeek not only challenges the US's dominance in this emerging field but also raises questions about the enormous AI spending by companies. Furthermore, the tech industry is also impacted by uncertainties about the effects of President Trump's tariff policies on the US economy and inflation. An index tracking the "Big Seven" including NVIDIA Corporation has fallen by 11% from its peak in December last year. The tech-heavy Nasdaq 100 index has also dropped nearly 5% from its record high closing points last week. Despite tech giants like Meta Platforms (META.US) and Amazon.com, Inc. (AMZN.US) reaffirming their plans to continue increasing capital expenditures this year, the stock prices of NVIDIA Corporation and other hardware manufacturers are still overshadowed by uncertainty. Krishna Chintalapalli, portfolio manager at Parnassus Investments, stated that NVIDIA Corporation's solid performance will delay some major issues surrounding the AI boom by three to six months. "But the long-term debate has not been resolved," he said. "Issues like the sustainability of spending, monetization of large language models (LLMs), and enterprise adoption rates still exist. While progress is being made, we are still in the early stages." After the initial returns from the AI boom have been largely realized, "we are looking for long-term certainty," he added. "This may not necessarily come from NVIDIA Corporation, but from software companies, enterprise IT departments; once they start seeing the actual returns from AI, it may kick off the next cycle." "The real concern is what the industry will look like in 3-5 years."