For some time now, Nvidia has been riding a number of tailwinds, including strong pricing power thanks to high demand for its chips and a tight supply that’s helping the company command gross profit margins of over 70%. The chipmaker reported earnings for its fiscal second quarter on Wednesday that beat market expectations, although the stock fell in extended trade Thursday as investors hoped for an even bigger rise . Looking ahead, one fund manager highlighted a sign for investors to watch closely that could foreshadow the start of the erosion of Nvidia’s pricing power and margins. That signal is capital expenditure — or capex — from so-called “hyperscalers,” like Microsoft, Google and Amazon. Several major technology firms have already released their June quarter earnings reports, which showed rising spending, particularly on artificial intelligence — which includes the graphics processing units that Nvidia designs. These are the biggest cloud computing players in the world that have been bulking up their infrastructure to train artificial intelligence models. Microsoft said June quarter capex rose more than 77% year-on-year to $19 billion. Google parent Alphabet meanwhile said the company’s capex in the June quarter rose more than 90% against the same period of last year. Tech giants have signaled that high spending on AI is likely to continue. “As long as that’s going on, you can expect this margin situation that Nvidia has right now to continue,” Josh Koren, founder of Musketeer Capital Partners, told CNBC’s “Street Signs Europe” on Wednesday. “But when we start to see those capex guidance trail off … that’s how you know that the pricing is kind of starting to erode,” he added. He said that likely won’t happen in the current quarter, but might take place in a not too distant future. “I wouldn’t be surprised to see it happen maybe within the next two or three quarters,” Koren said. And when that does happen, it could push Nvidia’s share price down 20% or more, he added. Koren and his firm does not own Nvidia stock. Analysts on Wednesday saw around a 7% rise in Nvidia’s share price from Tuesday’s closing price, according to LSEG data. There were 18 “strong buy” and 37 “buy” ratings on the stock. Nvidia is now facing rising competition from the likes of AMD, but many analysts still think the company has a strong position to fend off rivals. Yang Wang, senior research analyst at Counterpoint Research, said that Nvidia will take the bulk of the money from cloud companies over the next two to three years, as they continue to ramp up capex. “Nvidia will still take the lion’s share of, to our estimates, $700 billion of capex over the next two and a half years. So the outlook should still be strong for Nvidia,” Wang told CNBC’s “Squawk Box Europe” on Wednesday.