The BareStory
Nvidia is scheduled to report its third-quarter earnings on Wednesday amid discussions about the company's market influence. The report follows a significant sales forecast from its CEO, while some analysis points to risks in the tech sector.
In October, Nvidia CEO Jensen Huang announced that the company has $500 billion in orders for its artificial intelligence chips for 2025 and 2026 combined. Huang said the orders for its GPUs and networking parts come from major technology companies including Google, Amazon, Microsoft, and Meta. Analysts polled by LSEG now expect Nvidia to have $286.7 billion in sales for 2026 and are anticipating $54.9 billion in sales for the upcoming quarterly report.
Despite the CEO's forecast, Nvidia's stock was recently trading 5% lower than its price on October 28, which one source described as reflecting an investor debate over the AI boom. According to a description of an analysis by Henry Curr of The Economist, a potential bubble in tech stocks could burst, leading to major consequences for the global economy.
Investors are also watching for the company's response to competition, as some customers like Amazon and Google are promoting their own semiconductors. Uncertainty also surrounds sales to China. An export license deal for the company’s H20 chip was reportedly reached with President Donald Trump in August, but company representatives have since made pessimistic comments on the matter. According to Huang, a decision to sell current-generation chips to China was up to President Trump. During the quarter, Nvidia also reportedly agreed to invest up to $10 billion in OpenAI and $5 billion in Intel.
How it may affect me
As a U.S. reader:
• A potential burst in the tech stock bubble could have major consequences for the economy, possibly affecting personal investments and retirement savings.
• The performance of Nvidia and its large investments in companies like Intel and OpenAI may influence the stability and direction of the U.S. technology market.
• Competition between Nvidia and its major customers like Google and Amazon could affect the future cost and innovation of AI-driven services used by the public.
