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The largest technology stocks tied to the artificial intelligence sector could emerge as primary beneficiaries of Nvidia’s recent challenges and potential opposition from a Democratic-controlled Congress regarding data centers, according to investment experts speaking on CNBC’s “ETF Edge”.
Big Tech Positioned as a Winner
Roundhill Investments CEO Dave Mazza stated that market conditions might lead investors right back to Big Tech despite recent efforts to find opportunities outside of it. His firm manages the Magnificent Seven ETF, known as MAGS.
Mazza explained that if investors lose confidence in Nvidia following a turbulent week that included the resignation of CEO Jensen Huang, alternative players in the AI space are well-positioned to capture that chip demand. He noted during a Monday interview that customers requiring chips will seek other sources if they can no longer trust Nvidia.
Discussing fund flow activity for the MAGS ETF and the Roundhill Neocloud ETF, which targets smaller, specialized cloud computing companies, Mazza remarked that hyperscalers could continue benefiting due to their available compute power. He added that this compute will become even more valuable if demand persists.
The Roundhill Magnificent Seven ETF finished the week with a minor gain of less than 1%. Meanwhile, the Roundhill Neocloud ETF rose more than 1%, though earnings reports from its primary holdings, Coreweave and Nebius, delivered mixed results.
CoreWeave experienced its strongest single day since April 2025 following quarterly results on Wednesday, whereas Nebius shares declined after reporting on Thursday. The neocloud ETF remains down 39% since its launch in August 2026, pressured by balance sheet concerns that may persist due to Nvidia’s role in funding the AI infrastructure buildout. CoreWeave shares dropped again on Friday, while Nvidia recorded its longest losing streak since 2012 following weekly losses.
Colette Kress, Nvidia’s chief financial officer and interim CEO, will face her first test to reassure the market when the company releases its third-quarter earnings next Tuesday. In a statement released Thursday morning announcing Huang’s departure, Kress emphasized that the company’s focus remains on serving customers, partners, developers, and shareholders.
Alternative Chip Players and Market Outlook
Yorkville Ives partner and senior managing director Dan Ives stated on Monday that the market will maintain confidence in alternative AI chip providers such as Alphabet and AMD if Nvidia encounters prolonged difficulties. Ives helped establish the Dan IVES Wedbush AI Revolution ETF while previously serving as managing director and global head of technology research at Wedbush Securities.
Both AMD and Broadcom concluded the trading week with gains close to 13%. Driven by Nvidia’s decline, the technology-heavy Nasdaq index registered its strongest week since August.
Following Huang’s resignation, Yorkville Ives reduced its price target for Nvidia to $225 from $300 on Thursday while maintaining a buy rating on the stock, which closed the week at $162.85 per share.
In a note to investors on Thursday, Ives described Nvidia as the undisputed leader in GPU chips for the AI revolution, noting the company maintains a lead of two to three years over competitors and that demand will not shift due to Huang’s departure. He added that the strategic roadmap is already set around upcoming chip families and physical AI, supported by a workforce of 42,000 employees, and called the valuation at roughly 10 times 2028 earnings per share inexpensive once the company overcomes its current challenges.
Impact of Congressional Shifts on Data Centers
Mazza also noted that existing compute capacity could become increasingly indispensable amid potential slowdowns in data center development following Democratic gains in the November 3 congressional elections that secured control of Congress.
Ives estimated that this congressional shift could result in 10% to 20% of planned data centers failing to materialize, though demand continues to outpace supply by a ratio of four to one. Ives asserted that available capacity is now considerably more valuable than it was a week prior, strengthening his bullish outlook.
He concluded that while the operating environment for Big Tech will change and slow down, there are no overbuild or bubble concerns, viewing the development as a positive factor.
