New York, May 19, 2026 – Artificial intelligence stocks showed a mixed performance on Tuesday afternoon, with Nvidia (NVDA) edging higher ahead of its highly anticipated earnings report, while CoreWeave (CRWV) declined sharply after Alphabet's Google and Blackstone unveiled a new AI cloud venture. Nvidia's results, due Wednesday, are seen as a pivotal test for the entire AI trade, as investors weigh the company's ability to maintain dominance amid intensifying competition.
Nvidia shares rose approximately 0.8% in early afternoon trading, as market participants braced for what is expected to be another blockbuster quarterly report. Analysts polled by LSEG forecast a 79% year-over-year increase in April-quarter revenue, with adjusted profit rising 81.8%, driven by sustained spending from major cloud customers like Microsoft (MSFT) and Meta (META). However, the stock has declined immediately after the last three earnings releases, despite strong results, raising concerns about valuation and market expectations.
In contrast, CoreWeave tumbled 3.7% after Google and Blackstone announced a joint venture that will offer data-center capacity powered by Google's custom Tensor Processing Units (TPUs). Blackstone committed an initial $5 billion in equity, with plans to bring 500 megawatts of capacity online by 2027. The venture will operate under a compute-as-a-service model, allowing customers to rent processing power rather than purchasing hardware. Blackstone President Jon Gray described the opportunity as "a generational opportunity," while Google Cloud CEO Thomas Kurian said the venture "helps meet growing demand for TPUs."
The broader semiconductor sector saw gains, with the iShares Semiconductor ETF (SOXX) rising 1.8%. Advanced Micro Devices (AMD) advanced 0.5%, and Micron Technology (MU) surged nearly 5.9%, benefiting from strong demand for memory chips used in AI servers. However, Broadcom (AVGO) fell 1.2%, and Microsoft lost 1.3%, while Palantir Technologies (PLTR) slipped 0.5%.
The Google-Blackstone move intensifies the competitive landscape for Nvidia, particularly in the inference stage of AI—the process of running already-trained models. While Nvidia remains dominant in training AI models, investors are increasingly focused on inference, where cost efficiency is critical and rivals like AMD, Google, and Amazon are gaining traction. Gabelli Funds portfolio manager John Belton noted that the key question is whether "the Nvidia ecosystem" can remain "as dominant" as inference workloads expand.
Physical constraints also pose a challenge. Elazar Advisors analyst Chaim Siegel pointed out that some customers want more of Nvidia's graphics processors (GPUs) but "don't really have the data centers" ready to house them. Delays in building data centers, securing power connections, or installing cooling systems could slow chip orders, adding to the uncertainty.
On the software side, the market was less decisive. ServiceNow (NOW) initially rose but later fell 2.4%, while Salesforce (CRM) slipped 0.4% and Workday (WDAY) declined 0.6%. Mizuho analyst Gregg Moskowitz said he still sees "very attractive investments in software" for patient investors, but the sector's performance highlighted a growing selectivity among investors.
Market strategists caution that Nvidia's lofty valuation and rising bond yields could pressure growth stocks. Ameriprise strategist Anthony Saglimbene warned that higher yields could "challenge what investors are willing to pay" for long-duration growth stocks, which depend heavily on future earnings. A Reuters column noted that Nvidia's market value stands around $5.5 trillion, and despite strong earnings, the stock has fallen after each of the last three reports.
As the market awaits Nvidia's results, the downside risks include slower data-center buildouts, higher borrowing costs for cloud customers, rising memory and packaging costs, and tougher competition from custom chips. For now, the AI trade is narrowing, and Nvidia's earnings will reveal whether this is disciplined selection or the first crack in a crowded bet.
