On March 4th, Bernstein analysts Stacy A. Rasgon, Alrick Shaw, and others released a report stating that although NVIDIA has performed poorly this year and has a low valuation, the Blackwell product cycle of NVIDIA is accelerating, and the current valuation is becoming increasingly attractive.The real risk that Bernstein is concerned about is the rising regulatory pressure, specifically that the U.S. government may introduce new regulations. For every $10 billion decrease in revenue, NVIDIA's earnings per share (EPS) would drop by approximately $0.25.This year has been challenging for NVIDIA—affected by growth concerns, supply chain issues, tariffs, and regulatory risks, NVIDIA and many AI semiconductor peers have been severely impacted, with the stock price down 15% year-to-date, underperforming the overall weak semiconductor market (SOX index down about 8%) and the S&amp;P 500 index (down about 1%).<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/7d57f98f-0b30-42b1-ac16-ee4c516ba653.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/7d57f98f-0b30-42b1-ac16-ee4c516ba653.png"/>Moreover, NVIDIA's current valuation has fallen to a low point. After the significant drop in U.S. stocks yesterday, NVIDIA's forward price-to-earnings ratio is about 25 times, marking the lowest level in the past year and approaching the lowest point in a decade.<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/bfb2e7e6-283d-4cf2-a17e-7f4c17f97afb.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/bfb2e7e6-283d-4cf2-a17e-7f4c17f97afb.png"/>Bernstein stated that despite market concerns about NVIDIA's new product cycle, after communicating with NVIDIA, they confirmed that Blackwell revenue for the fourth fiscal quarter reached $11 billion, with all orders shipped in January, indicating that the supply chain bottleneck has been broken.Additionally, NVIDIA indicated that demand will continue to exceed supply in the coming quarters, customer capital expenditures (Capex) are also on the rise, and importantly, DeepSeek does not pose a threat to AI demand but may actually accelerate growth.<h2>What are the real concerns?</h2>For NVIDIA, a potential risk that Bernstein is focused on is the rising regulatory pressure—AI diffusion rules. This refers to the possibility that the U.S. government may introduce new regulations to restrict the international diffusion of AI-related technologies and hardware.Bernstein warned that for every $10 billion decrease in revenue, NVIDIA's earnings per share (EPS) would drop by approximately $0.25.Nevertheless, Bernstein believes that concerns about the &#34;AI trade being over&#34; are still premature, NVIDIA's current valuation is becoming increasingly attractive as market sentiment has clearly shifted to caution, but corporate spending willingness is still on the rise, the product cycle has just begun, and the GTC conference will be held in a few weeks.Furthermore, historically, when NVIDIA's price-to-earnings ratio falls to 25 times or below, investors have typically been able to achieve substantial returns (the average next-year return rate has reached 150%, with relatively limited downside risk)<img src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/42fa8e17-f44d-4111-b531-3de9a0a6743c.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="" original-src="https://imageproxy.pbkrs.com/https://wpimg-wscn.awtmt.com/42fa8e17-f44d-4111-b531-3de9a0a6743c.png"/>

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Bernstein stated that although NVIDIA has performed poorly this year, its valuation is becoming increasingly attractive. The real risk that Bernstein is concerned about is the rising regulatory pressure, specifically that the U.S. government may introduce new regulations. For every $10 billion decrease in revenue, NVIDIA's earnings per share (EPS) would drop by approximately $0.25

- Bernstein analysts Stacy A. Rasgon and Alrick Shaw report that despite Nvidia's poor performance and low valuation this year, the Blackwell product cycle is accelerating, making current valuations increasingly attractive.  
- The main concern is rising regulatory pressure from the U.S. government, which could impact Nvidia's earnings, as a $10 billion revenue drop would reduce EPS by approximately $0.25.  
- Despite market worries, Bernstein believes it is premature to conclude that the "AI trade is over," as Nvidia's valuation is appealing, and historical data suggests strong returns when the P/E ratio falls to 25 or below.

NVIDIA, is everything over?