Nvidia holdings disclosure pumps up shares of small AI companies

Investors
have
become
so
enamored
with


Nvidia’s
artificial
intelligence
story
that
they
want
a
piece
of
anything
the
chipmaker
touches.

On
Wednesday,


Nvidia
disclosed
in
a

regulatory
filing
that
it
has
stakes
in
a
handful
of
public
companies:


Arm,


SoundHound
AI,


Recursion
Pharmaceuticals,


Nano-X
Imaging,
and


TuSimple.

With
the
exception
of
Arm,
which
topped
$130
billion
in
market
cap
recently,
shares
of
the
Nvidia-backed
companies
soared
Thursday
following
the
13F
filing,
a
form
that
must
be
submitted
by
institutional
investment
managers
overseeing
at
least
$100
million
in
assets.

But
none
of
these
investments
would
be
surprising
to
anyone
who
took
the
time
to
sift
through
old
news
reports
and
filings.
The
AI
mania
is
firmly
in
an
irrational
exuberance
phase,
and
investors
are
pouncing
on
anything
and
everything
in
the
space.

No
stock
is
hotter
than
Nvidia,
which
passed


Amazon
in
market
value
Tuesday
and
then


Alphabet
on
Wednesday
to
become
the

third-most-valuable
company
in
the
U.S.,
behind
only


Apple
and


Microsoft.
Nvidia
shares
are
up
more
than
200%
over
the
past
12
months
due
to
seemingly
limitless
demand
for
its
AI
chips,
which
underpin
powerful
AI
models
from
Google,
Amazon,
OpenAI
and
others.

SoundHound,
which
uses
AI
to
process
speech
and
voice
recognition,
jumped
67%
on
Thursday,
after
Nvidia
disclosed
a
stake
that
amounted
to
$3.7
million
at
the
time
of
the
filing.
Nvidia

invested
in
SoundHound
in
2017
as
part
of
a
$75
million
venture
round.

SoundHound
went
public
through
a
special
purpose
acquisition
company
in
2022,
and
Nvidia
was
named
in
its

presentation
as
a
strategic
investor.

Nano-X
uses
AI
in
medical
imaging.
Nvidia’s
disclosure
of
a
$380,000
investment
in
the
company
sent
the
stock
up
49%
on
Thursday.
Nvidia’s
involvement
dates
back
years
to
a

venture
investment
in
Zebra
Medical,
an
Israeli
medical
imaging
startup.
Nano-X

acquired
Zebra
in
2021.

TuSimple,
an
autonomous
trucking
company,
rocketed
37%
on
Thursday
after
the
disclosure
of
Nvidia’s
$3
million
stake.
The
share
rally
comes
a
month
after
the
company

announced
plans
to
delist
from
the
Nasdaq
due
to
a
“significant
shift
in
capital
markets”
since
its
2021
IPO.
TuSimple
debuted
at
$40
a
share
and
now
trades
for
roughly
50
cents.

“Accordingly,
the
Special
Committee
determined
that
the
benefits
of
remaining
a
publicly
traded
company
no
longer
justify
the
costs,”
TuSimple
said
in
a
release
Jan.
17.
“The
Company
is
undergoing
a
transformation
that
the
Company
believes
it
can
better
navigate
as
a
private
company
than
as
a
publicly
traded
one.”

Nvidia

invested
in
TuSimple
in
2017,
four
years
before
the
IPO.

Nvidia
acquired
its
stake
in
biotech
company
Recursion
more
recently.
Like
TuSimple,
Recursion

went
public
in
2021,
but
Nvidia
bought
in
two
years
later
through
what’s
called
a
private
investment
in
public
equity,
or
PIPE.
Nvidia
bought
$50
million
worth
of
shares
in

2023
and
now
has
an
investment
worth
$76
million,
according
to
its
filing.

Recursion
shares
spiked
14%
on
Thursday.

Nvidia’s
own
financials
will
be
on
full
display
next
week,
when
the
company
reports
quarterly
earnings.
Analysts
are
expecting
year-over-year
revenue
growth
above
200%
to
more
than
$20
billion.

The
company’s
more
recent
investments
are
likely
to
be
much
more
significant
than
its
earlier
bets,
disclosed
late
Wednesday,
because
they’re
at
the
heart
of
the
AI
boom.
In
recent
years,
Nvidia
has
backed
hot
AI
startups
including

Cohere,

Hugging
Face,

CoreWeave
and
Perplexity.

“AI
is
transforming
the
way
consumers
access
information,”
said
Jonathan
Cohen,
Nvidia’s
vice
president
of
applied
research,
in
Perplexity’s

announcement
of
a
$73.6
million
funding
round
in
January.
“Perplexity’s
world-class
team
is
building
a
trusted
AI-powered
search
platform
that
will
help
push
this
transformation
forward.”

WATCH:

Perplexity
AI
aims
to
rival
Google

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