Nvidia's trailing 12-month price-to-earnings ratio dropped to 36.4 times on Monday, according to data from YCharts. The decline has been driven by a sharp price decline in Nvidia's stock, which finished Monday down 30% from its intraday record high reached in early January.

The P/E ratio shows the multiple investors are paying for a company relative to its earnings. The higher the P/E ratio, the more expensive the stock based on trailing earnings. The P/E ratio is helpful when analyzing companies with consistent business models and rangebound growth rates,

Investors appear worried about the health of AI spending. But big AI customers don’t seem hesitant, an analyst notes.

With shares down 20% year to date, Nvidia (NVDA -0.67%) has been off to a bad start in 2025, even though its chip business continues to fire on all cylinders. Is the market predic