Artificial intelligence chip maker Nvidia is poised to unveil its latest financial performance on Wednesday, with the spotlight squarely on sales of its Blackwell chip. This comes amidst interest over future demand triggered by a Chinese tech company’s assertion that it can efficiently train AI models using fewer resources.
Analysts are anticipating that Nvidia will announce fourth-quarter adjusted earnings estimated at 85 cents per share, drawing $38.08 billion in revenues as projected by FactSet. The company’s expected net income stands at $19.58 billion.
Nvidia’s market activities hold significant implications for the overall U.S. stock market. The chip maker has secured its place as the second-largest entity on Wall Street, exerting substantial influence on the S&P 500 index and others, second only to Apple. Based in Santa Clara, California, Nvidia’s market value now surpasses $3 trillion.
Benefiting from the AI surge, Nvidia and other tech firms have been pivotal in the recent series of records set by the S&P 500, the latest of which occurred last week. Despite concerns over persistent inflation and potential economic strains from trade tariffs and other government policies, these companies’ robust profits have buoyed the market.
Notably, Nvidia contributed to over 20% of the S&P 500 index’s total returns last year, outpacing its 499 peers. However, should Nvidia’s momentum waver—particularly with critics warning that its stock price has surged excessively—it could spell trouble for Americans with S&P 500 index funds in their retirement and investment portfolios.
This quarterly financial report coincides with Chinese firm DeepSeek’s announcement of a significant AI development. DeepSeek claims it has engineered a large language model rivaling ChatGPT and other American competitors, offering a cost-efficient solution that utilizes Nvidia’s chips effectively to process data volumes.
DeepSeek’s news momentarily erased $595 billion from Nvidia’s market value, though Nvidia acknowledged DeepSeek’s achievement as a commendable AI progress. It highlighted the utilization of “widely-available models and compute that aligns with export control regulations.”
Nvidia has been a trailblazer in AI innovation, largely driven by founder and CEO Jensen Huang’s winning gamble on chip technology crucial for the AI industry’s expansion. The company is known for making bold moves, such as its 1999 development of the graphics processor unit (GPU), which not only fueled the PC gaming realm but also transformed the landscape of computer graphics.
Nvidia is set to release its quarterly earnings report post-market close on Wednesday.
