On March 10, 2000, the Nasdaq-100 traded at 5,048.62. On October 9, 2002, it had dropped to 1,114, down 78% from its peak. If a decline occurs anywhere near that level, it will be due to several factors combined. The most likely outcome is a huge disappointment in the future of artificial intelligence (AI). Another would be raging inflation caused by tariffs. (This leaves a major war out of the equation.) A drop of the same magnitude would take the Nasdaq down over 19,000 points.
The more Nvidia beats Wall Street's expectations, the harder it seems to satisfy them. The chipmaker reported second-quarter revenue of $46.74 billion, with sales up 56% year over year, and earnings per share of $1.08, easily topping Wall Street's forecasts. The company's gross margins also surged to 72.4%, up from 61% last quarter. For most other companies, the results would be a home run. But for Nvidia, whose quarterly financials have become a litmus test for the AI boom, Wall Street wasn't convinced. Shares fell more than 3% in after-hours trading as the chipmaker came up short of most of Wall Street's most optimistic forecasts. The stock was trading lower in pre-market, down about 1.3%.