AI Stocks, Including Nvidia, Could Struggle in 2025 as Quantum Computing Takes the Lead

Nvidia has become a symbol of the AI revolution, with its stock nearly tripling in 2024 and briefly surpassing Apple as the world’s most valuable company. But fund manager Doug Kass predicts a stark reversal in 2025. He warns that Nvidia’s stock could nosedive to $50–$75 due to an unsustainable surge in demand and energy supply constraints.

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Barclays Research estimates that U.S. data centers, which currently use 3.5% of the nation’s electricity, could consume over 9% by 2030. Kass forecasts power outages and spiking utility costs, leading to public backlash and hefty taxes on AI data centers. This shift could force companies like Meta and Amazon to scale back their AI investments.

Quantum Computing Set to Surpass AI by 2025

While AI struggles with energy and scalability issues, quantum computing is poised to take the lead. Kass highlights the skyrocketing stock prices of quantum pioneers like Rigetti Computing (RGTI) and D-Wave Quantum (QBTS), which soared by 15x and 11x in 2024.

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Quantum computing, which leverages the principles of quantum mechanics, offers groundbreaking solutions for complex problems in industries like cryptography, drug development, and logistics. Experts believe that in 2025, quantum computing will replace AI as the top focus for innovation and investment.

Bitcoin Faces Potential Collapse Amid Security Risks

Kass predicts that 2025 could be a devastating year for cryptocurrencies. He warns of possible hacks targeting proof-of-work systems like bitcoin, which could drive the cryptocurrency’s value from its current $95,000 to under $25,000.

Such a collapse would likely trigger panic across the financial world, with secondary cryptocurrencies losing all value. Kass also forecasts a significant 7% drop in equity markets within a month as investors react to the turmoil.

AI Agents Expected to Revolutionize Workflows

Amid challenges for AI, some advancements may reshape industries. James Zou, a professor at Stanford University, predicts that 2025 will see the rise of collaborative AI systems, or “AI agents.” These teams of specialized AI models will work together to tackle complex tasks with greater efficiency and reliability.

“Innovative hybrid teams, led by humans and supported by diverse AI agents, will redefine industries like healthcare and finance,” Zou explained. This collaborative approach could shift AI’s focus from consumer tools to enterprise solutions.

Global Peace Could Be on the Horizon

Kass offers a more optimistic outlook for global politics, predicting resolutions to major conflicts in 2025. He envisions the end of the Ukraine war and a landmark peace accord between Israel and Saudi Arabia, which could foster stability in the Middle East.

Energy, Technology, and Stability in 2025

Doug Kass’s forecasts for 2025 reveal a year of major shifts. From energy challenges slowing AI’s growth to the rise of quantum computing and the potential collapse of cryptocurrencies, the coming year will bring significant changes. These developments, combined with hopes for global peace, could redefine industries and geopolitical landscapes alike.

Also Read: Wall Street Eyes Inflation Trends as 2025 Approaches