Nvidia, AMD, and Other AI Chip Stocks Are Swooning. Blame OpenAI.

Monday, the stock market was on fire, with the S&P 500 and the Nasdaq Composite both hitting new all-time highs, and optimism reigned. The mood turned dour on Tuesday morning as a report about one of the most consequential stocks in artificial intelligence (AI) caught investors off guard, sending AI chip stocks tumbling.

Growth is slowing at OpenAI, as the ChatGPT parent missed internal goals for revenue and user growth, according to a report by The Wall Street Journal. The company was shooting for 1 billion users by the end of 2025, a goal it has yet to hit, according to the report. If true, this could have important implications for the future of AI.

Image source: The Motley Fool.

The first domino to fall?

OpenAI was arguably the catalyst that kick-started the AI revolution. When ChatGPT was released, it became the fastest-growing consumer app in history, gaining more than 1 million users within five days of its launch in November 2022, and soaring to 123 million monthly active users within three months. Earlier this year, OpenAI announced it had 900 million weekly active users and 50 million subscribers.

To feed this unprecedented demand, OpenAI has spun a web of deals with some of the biggest names in technology -- including chipmakers and cloud operators -- arguing that compute capacity was the biggest obstacle to its growth. The magnitude of these agreements is staggering, with more than $1 trillion worth of deals inked in 2025 alone:

• Nvidia (NASDAQ: NVDA): $500 billion
• Oracle (NYSE: ORCL): $300 billion
• Advanced Micro Devices (NASDAQ: AMD): $270 billion

The implication is that if OpenAI's user growth slows, its revenue will follow suit, and the company won't have sufficient resources to pay for all its AI chip and computing obligations. Indeed, CFO Sarah Friar expressed concerns that OpenAI wouldn't be able to "pay for future computing contracts if revenue doesn't grow fast enough," according to the report.

OpenAI pushed back, arguing that the company is "firing on all cylinders" and calling the report "prime clickbait." Investors were unconvinced, pushing AI stocks lower, with Nvidia down 3%, and AMD and Oracle each down 4% on the news (as of this writing).

It's important to point out that these deals aren't driving current growth. In the most recent quarter, Nvidia's revenue jumped 73% year over year, AMD's climbed 34%, and Oracle's grew 22%. Slowing growth at OpenAI was inevitable and might push out future growth. That said, missing an internal forecast isn't a deal breaker, nor is it a dire warning.

What this means for investors

When ChatGPT was released, it had the stage to itself, but that was short-lived. In the years since, a host of AI tools have emerged, with each vying for market share. Alphabet's Google Gemini has amassed 750 million monthly active users, Microsoft Copilot has 150 million, and estimates place Anthropic's Claude -- a relative newcomer -- at between 18 million and 30 million users, though no official tally has been released.

This suggests that while the pool of AI users is still growing, it's also being reorganized, as users find the AI tool best suited to their needs.

This means that demand isn't falling, it's merely being redistributed among the available options. This further suggests that the sell-off currently plaguing AI chip stocks is overdone. Furthermore, Nvidia and Oracle are currently selling for 25 times and 22 times forward earnings, respectively, so they're attractively priced relative to the opportunity. AMD is a bit pricier at 48 times forward earnings.

A slowing of OpenAI's growth doesn't suggest anything dire for the broader AI market, but merely a redistribution of the wealth. As such, investors should ignore the hyperbole and stay invested.

Danny Vena, CPA has positions in Alphabet, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Microsoft, Nvidia, and Oracle. The Motley Fool has a disclosure policy.