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Nvidia shorts down $2.3 billion with stock up 25% - S3 Partners

Published 2023/05/25, 18:49
Updated 2023/05/25, 19:02
© Reuters. FILE PHOTO: A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration
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By Caroline Valetkevitch

NEW YORK (Reuters) - Short sellers in shares of Nvidia (NASDAQ:NVDA) Corp. were down $2.3 billion in mark-to-market losses Thursday as the stock surged more than 25% in early trading following the chipmaker's blowout forecast, according to financial data firm S3 Partners.

For the year to date, including this morning's move, Nvidia shorts are likely down more than $8 billion, or 96%, Ihor Dusaniwsky, S3 managing director wrote.

"Even with significant short covering in NVDA, it is the fourth most shorted stock in the U.S.," he noted. It follows Apple (NASDAQ:AAPL), Tesla (NASDAQ:TSLA) and Microsoft (NASDAQ:MSFT) in most-shorted stocks.

Nvidia's stock was last at about $384. The company was getting close to becoming the first trillion-dollar chipmaker after it forecast late Wednesday second-quarter revenue more than 50% above Wall Street estimates. The company said it is increasing supply to meet surging demand for its artificial-intelligence chips, which are used to power ChatGPT and other services.

Including the move on Thursday, the shares are up about 160% this year and easily the top-performing stock in the S&P 500.

© Reuters. FILE PHOTO: A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration

Investors who sell securities 'short' borrow shares and then sell them, expecting the stock to fall so they can buy the shares back at the lower price, return them to the lender and pocket the difference.

(This story has been refiled to add Nvidia to the headline)

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