NVIDIA Stock Performance and Economic Impact of Recent Deals

NVIDIA (NVDA) stock rose 3.7% by noon on Wednesday, May 14, 2025, extending its nearly 6% gain from the previous day, pushing its market capitalization above $3 trillion for the first time since February. This rally followed NVIDIA’s announcement of a deal with Saudi Arabia’s AI venture Humain, highlighting robust demand for AI hardware and renewed market focus on the sustainability of AI infrastructure spending. Below is a detailed analysis covering background, data, deal specifics, and potential implications.

Background and Context

On May 14, 2025, NVIDIA’s strong performance echoed its surge the prior day, when its market cap surpassed $3 trillion, marking its highest level since February. These deals underscore growing Middle Eastern interest in AI technology, particularly Saudi Arabia’s ambitions to position itself as a regional and global AI hub.

Meanwhile, policymakers Clare Lombardelli and Megan Greene emphasized the need for more data to justify further interest rate cuts, citing persistent wage growth and service-sector inflation pressures. Lombardelli, speaking at the Bank of England Observers’ Conference on May 12, 2025, noted that wage growth stood at 5.9% in the three months to February 2025—far above levels consistent with a 2% inflation target. She warned that proposed tariffs under the Trump administration could dampen global growth in the short term, while prolonged trade fragmentation might raise inflation and reduce productivity. Greene highlighted sluggish improvements in services inflation (4.7% in March) and cautioned against premature rate cuts, citing risks of rekindled inflation expectations .

Deal Details

NVIDIA announced plans to supply hundreds of thousands of AI chips to Saudi Arabia’s Humain over the next five years, with the first tranche including an AI supercomputer powered by 18,000 advanced GB300 Grace Blackwell chips.

Additionally, Bloomberg reported on Tuesday that the Trump administration might approve a deal allowing the UAE to purchase “over 1 million” NVIDIA AI chips.

Separately, Super Micro Computer (SMCI), a server manufacturer utilizing NVIDIA’s AI chips and designs, secured a $20 billion deal with Saudi data center firm DataVolt.

Summary of Key Deals:

Market Reaction and Analysis

Investors have closely monitored whether U.S. tech giants can sustain unprecedented levels of AI infrastructure spending while still exploring ways to fully monetize AI products.

One analyst noted: “While it remains to be seen how much of these announced plans will materialize, Tuesday’s moves have the potential to counter concerns over peak capital expenditures.” As of May 15, 2025, NVIDIA’s stock performance contrasts with lingering uncertainties about AI monetization, reflecting investor optimism toward these deals.

These deals signal rising Middle Eastern interest in AI but carry risks. Further global trade fragmentation could suppress economic output, productivity, and exacerbate inflation. Investors must also track deal execution, as analysts warn that announced plans may not fully materialize.

NVIDIA’s recent stock performance underscores booming demand for AI hardware, particularly in the Middle East. While these deals open new revenue streams, their long-term impact hinges on the global economic landscape and policy shifts.