NVIDIA (NVDA) Fell Due to Competitive Threat

Columbia Threadneedle Investments, an investment management company, released its “Columbia Threadneedle Global Technology Growth Strategy” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. The first quarter of 2025 was challenging for U.S. equities, marked by substantial policy shifts from the new U.S. administration, resulting in declines across all major U.S. indices.  In the quarter, the fund returned -12.26% compared to the S&P Global 1200 Information Technology Index-net’s -11.64%. Security selection drove the fund’s performance relative to the benchmark. In addition, you can check the fund’s top 5 holdings for its best picks for 2025.

In its first-quarter 2025 investor letter, Columbia Threadneedle Global Technology Growth Strategy highlighted stocks such as NVIDIA Corporation (NASDAQ: NVDA). NVIDIA Corporation (NASDAQ:NVDA) offers graphics and compute, and networking solutions. The one-month return of NVIDIA Corporation (NASDAQ:NVDA) was 6.36%, and its shares gained 14.98% of their value over the last 52 weeks. On June 10, 2025, the stock of NVIDIA Corporation (NASDAQ:NVDA) closed at $143.96 per share, with a market capitalization of $3.511 trillion.

Columbia Threadneedle Global Technology Growth Strategy stated the following regarding NVIDIA Corporation (NASDAQ:NVDA) in its Q1 2025 investor letter:

“However, the quarter was not without its challenges, starting with the fund holding NVIDIA Corporation (NASDAQ:NVDA). The threat of a new Chinese competitor upended the U.S. AI technology complex as fears rose that the lower-cost alternative that performed as well or better than most U.S. models could disrupt the market and reduce the need for AI semiconductors. NVIDIA reported quarterly results that showed growth – but still a bit subdued as compared with sky-high investor expectations. Profit margins were weak during the quarter as the company ramped up its new Blackwell chip architecture, which at $11 billion in quarterly revenue was the strongest product launch in company history.”

NVIDIA Corporation (NASDAQ:NVDA) is in 5th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 212 hedge fund portfolios held NVIDIA Corporation (NASDAQ:NVDA) at the end of the first quarter, which was 223 in the previous quarter. NVIDIA Corporation (NASDAQ:NVDA) reported another record quarter in fiscal first quarter of 2026 with $44 billion in revenues, representing a 69% year-over-year increase. While we acknowledge the potential of NVIDIA Corporation (NASDAQ:NVDA) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered NVIDIA Corporation (NASDAQ:NVDA) and shared the list of stocks Jim Cramer put under the microscope. RiverPark Large Growth Fund also discussed on NVIDIA Corporation (NASDAQ:NVDA) in its Q1 2025 investor letter. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.