However Nvidia has faced significant market challenges with stock dropping 2.8% yesterday following a 3% decline on Monday.
Investors are also reacting to broader market concerns, such as potential US. restrictions on Nvidia's chip exports to China and competition from emerging technologies, like DeepSeek's AI models, which could reduce demand for Nvidia's high-end chips.
Subscribe today for free
Kate Leaman, chief market analyst at AvaTrade said: “Nvidia’s Q4 earnings are coming up later today, and investors will be closely following the results. As the undisputed AI chip leader, Nvidia has been riding an incredible wave of demand. We’ll be watching to see if the momentum can keep going, or whether growth starting to level off.
“Expectations are sky-high. Analysts predict revenue of $38.15 billion – a mind-blowing 73% jump from last year – while earnings per share (EPS) are expected to rise 63% to $0.85. The data centre business has been the driving force behind this surge, with companies snapping up Nvidia’s Hopper chips to fuel their AI ambitions. Now, all eyes are on the rollout of Nvidia’s latest Blackwell chips and whether demand can stay this strong.
“But it’s more than just about the numbers. Investors want to know if the AI boom still has legs. Nvidia is expanding its lineup with new chips like Spectrum-X and H200, set to ramp up in the first half of the year. AI-powered PCs are gaining traction. Even the self-driving tech market is seeing growth, adding yet another revenue stream. It all sounds great – but there are risks, too.
“These include the breakthrough by DeepSeek, which claims to be developing AI models that require fewer GPUs. If that technology scales, it could dampen long-term demand for Nvidia’s high-end chips. Supply chain issues are another lingering concern, though they’re improving. And then there’s China-US chip restrictions and growing competition from local companies like Huawei, which could create headwinds. Plus, if enterprise and consumer spending slows, even Nvidia might not be immune.
“The bottom line is that Nvidia will likely deliver another strong quarter, but guidance is what really matters. Investors want to hear about AI spending trends, how quickly new chips are scaling, and whether efficiency gains in AI training could reshape demand. With Nvidia at the heart of the AI revolution, this isn’t just about one stock – it could set the tone for the entire market.”
RELATED STORIES
Nvidia opens 2025 with new AI agent, developer tools and a 'GPU shield'
DeepSeek accelerates R2 model launch amid US-China AI battle
