Over the last year there have been times when Nvidia’s (NVDA US) quarterly earnings reports have been the markets focal point and with the stock up more than five-fold in recent years its generally delivered a net bullish influence across markets, and especially anything AI related. On Thursday morning our time, NVDA US is set to report its first-quarter fiscal 2026 earnings, and expectations are high for this $US3.2 trillion AI behemoth. However, it could be a touch messy after NVDA wrote off $US5bn of inventory due to restrictions on its H20s entering China. The share prices’ short-term future is in the hands of Trump 2.0, as it sits in the crosshairs of the sensitive China-AI issue.
Three months ago, NVDA beat expectations with its 4Q update, delivering some astronomical numbers with quarterly revenue of $US39.3bn, with Data Centre (DC) revenue making up $US35.6bn. For this quarter, they guided to $US43bn, plus or minus 2%, with market consensus sitting at $US43.36bn
- We like NVDA as a business, who couldn’t, but it feels wide open to adverse tariff news.
MM is cautiously bullish on NVDA ~$US130
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The crowded AI traded unwound aggressively both pre and post-Liberation Day with pullbacks of ~40% commonplace in the big end of town, around double the underlying indices. At MM we remain very bullish the AI evolution but it’s a rapidly evolving space where todays winners could become the losers of tomorrow and the big winners of the next decade may not have even emerged.
- We believe AI will shape many industries over the coming years, and investors must remain flexible and open minded.
This morning, we’ve updated our stance on local data centre names with Goodman (GMG) set to provide a quarterly trading update tomorrow, ahead of NVDA results.
