"And in the tech world and beyond, one thing is clear: Nvidia's earnings aren't just about Nvidia anymore. The $4 trillion chipmaker's quarterly financials have become a litmus test for the AI boom-and, by extension, for the whole stock market. Constituting 8% of the market cap-weighted S&P 500 Index, and with an unrivaled grip on the chips that power generative AI, Wall Street now treats Nvidia's results more like a macroeconomic indicator than as a report card on a single company."
"And uncertainty about Nvidia's China business continues to loom large. After previously banning Nvidia from selling to China, earlier this month Nvidia and AMD struck a deal with the Trump administration to grant export licenses in exchange for a 15% revenue-sharing arrangement on China chip sales. "I suspect they will not count, nor forecast China revenue, there's too much uncertainty involved," predicts Karl Freund, founder and principal analyst at Cabrian-AI Research."
Nvidia's quarterly results have evolved into a broad indicator of the AI boom and overall market direction, driven by the company's $4 trillion valuation and dominant role in generative AI chips. The company represents about 8% of the market-cap-weighted S&P 500 Index and has become a cultural event, complete with watch parties. Nvidia's stock rose roughly 35% in three months, with analysts forecasting Q2 revenue up 53% year-over-year to $46 billion, EPS around $1.01, and data-center sales near $40 billion. Significant uncertainty surrounds China sales after export restrictions and a recent export-license deal that includes a 15% revenue-sharing arrangement, prompting expectations that China revenue may not be counted or forecast. Heightened investor concern about an AI-related stock bubble further amplifies the scrutiny on the earnings report.
Read at Fortune
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