[NVIDIA Underperforms Peers This Year, BofA Says Market Concerns Are Overblown] BlockBeats News, July 9 — NVIDIA (NVDA.O) has significantly underperformed the broader chip industry in terms of stock price performance so far this year. Bank of America considers this a 'more attractive buying opportunity' rather than a risk warning signal. Analyst Vivek Arya acknowledges that there are indeed some factors causing investor concerns, but he believes the market is overreacting. The rising cost of HBM components has sparked worries about gross margins, but Arya argues that investors are overestimating this pressure while underestimating NVIDIA's pricing power, scale advantages, and approximately $119 billion in supply chain commitments. He expects NVIDIA to offset the impact of higher HBM costs, as the pricing of the next-generation Rubin platform is likely to be significantly higher than the current Blackwell product line, thereby maintaining gross margins in the mid-70% range. The second major concern for investors stems from competition in custom chips, such as Google's collaboration with Broadcom to design TPUs. Arya believes this concern is also overstated. Google TPUs have been around for over a decade, during which NVIDIA's GPU revenue has grown 700-fold. In the long term, NVIDIA is expected to continue capturing 65% to 70% of AI infrastructure spending by hyperscale cloud service providers. Additionally, NVIDIA's current forward price-to-earnings ratio is approximately 18.69x, close to half of its 10-year average and near an 11-year low.