Nvidia’s earnings are a referendum on the AI trade

For the last three years, Nvidia (NVDA) has been the engine of the AI boom, and now Wall Street is watching to see whether that momentum can keep going. High-growth stocks have been struggling to maintain their bullish trend in 2026, with the tech-heavy NASDAQ 100 correcting by over 3% in the past month and trading in the red year to date.

But for NVIDIA, analysts are expecting another monster quarter. Current estimates call for about $1.54 in earnings per share, up 70% from last year, and revenue climbing 68% to $66.12 billion.

The extensive growth is still primarily driven by demand for AI chips and data center servers. Hyperscalers, companies like Meta Platforms (META), Microsoft (MSFT), and Amazon (AMZN), are still pouring billions into AI infrastructure. UBS estimates that direct AI capex of $423 billion in 2025 will rise above $570 billion in 2026, and some claim it may hit $700 billion.

NASDAQ 100 correction: Wall Street on edge

This week isn’t happening in a vacuum. Markets are already on edge thanks to rising geopolitical tensions from a looming attack on Iran and President Trump’s attempt to reinstate US tariffs.

That means Nvidia’s results won’t just move one stock. They could influence the entire market narrative heading into March. Since last November, investors have been slowly rotating out of the AI trade into comparably safer industries like consumer staples, utilities and healthcare.

A major beat and raise in Nvidia on Wednesday could return the market to its 2025 overweight-AI position.

NVIDIA earnings: Why guidance matters more than EPS

The headline numbers for Nvidia will be huge, but the real story is guidance.

Is demand for Blackwell GPUs still “off the charts,” as CEO Jensen Huang described it last quarter? Is cloud GPU supply still sold out? These are the questions Wall Street wants answers to.

If Nvidia signals that demand for AI compute is still compounding, the stock could regain momentum quickly.

Wall Street is already estimating that Q1 revenue will rise by $5 billion quarter-over-quarter to $71 billion. Any guidance above that level will likely lead to a post-market rally, while guidance that comes in below $70 billion would likely lead to a sell-off.

NVIDIA results: Jensen Huang’s press conference eyed

Another point of pressure is gross margin. Nvidia CFO Collete Kress said during the last earnings call that Nvidia is working to increase gross margin to the mid-70%. In Q3, the reading was 73.6%. To keep the market happy, a larger gross margin print will be needed this time.

On the earnings call, Jensen Huang is expected to address Nvidia’s new moves into the PC market via system-on-a-chip processors in partnership with Intel. He should also provide figures for the company’s sales in China, which were weak in Q3 due to Trump’s former export restrictions. Additionally, investors want to know if the timeline for Vera Rubin production is changing.

Analysts will also press Jensen on why he scaled back the earlier $100 billion investment commitment in OpenAI to $30 billion a few weeks ago. Does it mean that the leading model maker is losing its lead in AI?

NVIDIA Technical Analysis: 200-SMA keeps bullish bias

Nvidia earnings will shape the trend in the entire market, but they may also provide a good opportunity to buy NVDA stock.

A look at the daily chart shows that despite not hitting a new all-time high since last October, Nvidia stock is bullishly positioned to do so. NVDA has been finding support for about eight months in the demand zone stretching from $164 to $171. But the 200-day Simple Moving Average has now risen above that zone, which means that long-term support appears to be pushing the price dynamic higher.

Ahead of earnings, Nvidia has been trending above the 50-day SMA as well, placing bulls in close proximity to resistance at $211, near the all-time high and a level they will hope to test following the Wednesday release.

On the weekly chart, the longer-term top trendline points to the region near $235, which will become the next price target once the $211 resistance level is broken.

So, Nvidia’s Q4 results aren’t just another earnings report. This is a referendum on the entire AI investment cycle.

If Nvidia delivers and guides higher, the AI trade could accelerate again. If not, we may finally see the first real cracks in the story and see stock market indices move sharply lower.

(This article has been generated with the help of an AI tool.)