Why Navitas Stock Plummeted Today

Navitas Semiconductor (NASDAQ: NVTS) stock saw big sell-offs over the last week of trading. The chip specialist's share price closed out the stretch down 22.7% from the previous week's close, according to data from S&P Global Market Intelligence.

Navitas got hit with a big valuation contraction week amid multiple bearish catalysts. The stock sank after the company published its fourth-quarter earnings, and investors broadly sold out of growth-dependent tech stocks following new macroeconomic risks and concerns raised following Nvidia's Q4 report.

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Navitas' share price shrank following the company's Q4 results

Navitas published its fourth-quarter results after the market closed on Monday, posting performance that came in below the market's expectations. The business posted a loss per share of $0.21 on sales of $17.98 million for the period, coming in worse than the average Wall Street analyst estimate for a per-share loss of $0.14 on sales of $19.03 million for the period. Revenue was down 31% compared to the prior-year period.

For the first quarter, Navitas expects sales to come in between $13 million and $15 million. At the midpoint of the guidance range, management's forecast suggests an annual sales decline of roughly 39.6% for the business. Investors sold out of the stock following the weaker-than-expected Q4 print and forward guidance.

Macro pressures and Nvidia's Q4 results also weighed on Navitas stock

In addition to the company's own Q4 report, Navitas stock also saw sell-offs due to increasing focus on macroeconomic risk factors and potential disruptive factors highlighted in Nvidia's fourth-quarter conference call.

Despite Nvidia's Q4 results and forward guidance topping the market's expectations, artificial intelligence (AI) stocks saw a broad sell-off following the hardware leader's report. Investors saw bearish signals after Nvidia raised concerns about the potential impact from new export restrictions on semiconductors that only added to existing trade-war fears and inflationary dynamics.

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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.