Nvidia -3% as Pacific Crest cuts to Underweight

|By:, SA News Editor

Nvidia (NASDAQ:NVDA) -2.9% premarket after Pacific Crest downgrades shares to Underweight from Sector Weight, citing concerns that it may have captured so much of the available market that growth could become a problem.

Crest analyst Michael McConnell says he is concerned about "signs of desktop [graphics processing unit] market saturation, lower margins from incremental Nintendo Switch revenue and a possible pause in the company's datacenter business this summer."

McConnell says desktop GPU demand slowed in Q1, with sales to China down 30%-40% Q/Q and ~20% lower to the U.S., with channel inventory to blame.