BUSINESS-ECONOMY
It's been something of a wild ride for tech investors in recent weeks. Shares of AI giants Amazon, Microsoft, and Alphabet have all tumbled in the last three months: Alphabet by more than 6 per cent, and Amazon and Microsoft by more than 3 per cent. Nvidia stock has returned, but it's going to be put to the test once more. The next big event for the market will be when that chip darling reports earnings after the bell on Wednesday. It's not just the Nvidia stock that is at stake: Nvidia's results will set the pace for other AI players. "Nvidia's report and guidance will be absolutely key to the AI infrastructure trade," tech investor Paul Meeks told Yahoo Finance. It's been something of a wild ride for tech investors in recent weeks. Shares of AI giants Amazon, Microsoft, and Alphabet have all tumbled in the last three months: Alphabet by more than 6 per cent, and Amazon and Microsoft by more than 3 per cent. Neither can the second-tier AI players regain entry into the playing field. AMD has lost more than 16 per cent since mid-July, and Marvell Technology almost 6 per cent within that period. Strong results from Nvidia could revive some of that lost momentum, according to Wedbush's Dan Ives. "Nvidia is the heart and lungs of this bullish tech trade as the AI Revolution takes hold," Ives told Yahoo Finance. Ives, anticipating an Nvidia quarter of "shock and awe", says continued strong demand for the company's chips would have industry-wide ripple effects. Ives estimated in a client note that for every dollar spent on a Nvidia GPU chip, there is an $8 to $10 multiplier across the tech sector. Bernstein's Mark Shmulik, who covers many of Nvidia's biggest customers, including Meta, Amazon, and Google, quoted that the chip giant's results are likely to determine Big Tech's next step. "Nvidia is a bellwether of the Magnificent Seven and AI trade," Shmulik explained. "If there is any softness, maybe rotation out of the Mag 7 picks up a little bit of steam, but listening to other tech earnings, core fundamentals keep delivering." Nvidia stock has been soaring this year. Shares are up 180 per cent and up nearly 2,900 per cent over the past five years—making for a very tough bar for earnings this quarter. Estimates call for Nvidia's revenue to rise 112 per cent in its latest quarter, a dramatic slowdown from more than 250 per cent growth one year ago. For Wall Street, the consensus remains bullish. KeyBanc, Citi, and Goldman Sachs were among those on the street who reiterated their Buy ratings on the stock this week ahead of results. Only time will tell if Nvidia lives up to the hype this earnings season, but it's safe to say the stakes are high. A journalist, writing for the WION Business desk. Bringing you insightful business news with a touch of creativity and simplicity. Find me on Instagram as Zihvee, tr None
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