Nvidia (NVDA, Financial) is gearing up to drop its Q3 earnings on Wednesday, and the stakes couldn't be higher. After a jaw-dropping 200% rally this year, the AI chip king is expected to deliver explosive growth, with analysts predicting $0.74 earnings per share (up from $0.37 last year) on revenue of $33.2 billion—nearly double what it posted in the same period in 2022. A big chunk of that growth is riding on Nvidia's Data Center segment, forecasted to bring in $29 billion. But here's the kicker: all eyes will be on Q4 guidance. Wall Street wants to see revenue forecasts hit $37 billion or more. Anything less, and Nvidia's stock could wobble.
But the road's not all smooth. Reports of overheating in Nvidia's next-gen Blackwell AI chips are back in the spotlight, raising questions about potential production hiccups. Nvidia's downplaying it as normal “engineering iterations,” but these whispers could shake investor confidence. Add to that some broader market jitters—like disappointing results from Applied Materials (AMAT, Financial)—and suddenly, Nvidia's path forward doesn't seem so bulletproof. Even with “insane” demand for its AI chips, as CEO Jensen Huang puts it, Big Tech's spending could slow, and that's a risk nobody's ignoring.
Still, Nvidia isn't backing down. Heavyweights like Meta (META, Financial), Microsoft (MSFT, Financial), and xAI are lining up for Blackwell systems, and these chips could rake in billions in Q4 alone. But let's be real—Nvidia's stock is priced to perfection, and perfection's a tough act to follow. Whether the earnings report cements its dominance or sends investors scrambling, one thing's clear: volatility is coming. Strap in.
