So here we are again, folks. The entire stock market is basically sitting in a waiting room, nervously checking their phones while Nvidia gets ready to drop their quarterly numbers. No pressure, Jensen Huang, but literally everyone’s portfolio is riding on what you say tonight.
Let’s be real here – Nvidia has been the golden child of this bull market. While everyone else was trying to figure out what AI actually does (spoiler: it’s complicated), NVDA was busy printing money faster than the Fed during a crisis. The stock has been the S&P 500’s favorite child, lifting the whole market to those “this can’t be real” heights we’ve been seeing.
But here’s the thing about being everyone’s favorite – the moment you stumble, people start whispering. And boy, have they been whispering lately.
The Honeymoon’s Getting Rocky
Since late October, things have gotten a bit… awkward. The S&P 500 has dropped about 4% in three weeks (which in bull market terms is basically a full-blown panic), and Nvidia itself has shed 10% from its October peak of $212. Yesterday it closed at $181, which sounds fine until you remember this stock was supposed to only go up.
The problem? People are starting to ask uncomfortable questions like “Is AI spending sustainable?” and “Are these valuations completely bonkers?” You know, the kind of questions that make CFOs break out in cold sweats.
The Numbers Game
Wall Street expects Nvidia to pull another rabbit out of its hat tonight. We’re talking $54.9 billion in revenue (up 56% year-over-year) and $1.25 per share in adjusted earnings (up 54%). These aren’t just good numbers – they’re “how is this even possible” numbers.
The secret sauce? Their new Blackwell architecture is apparently ramping up faster than expected, which should help them keep eating AMD’s lunch in the AI chip space. Plus, their gross margins are expected to stay around 74%, which is the kind of profitability that makes other CEOs cry into their quarterly reports.
But here’s where it gets interesting (and by interesting, I mean terrifying for investors): Nvidia has beaten estimates over 90% of the time in the past five years, but lately, those beats have been getting smaller. It’s like they’re running out of ways to surprise us on the upside.
The Smart Money Is Getting Nervous
Remember Michael Burry? The guy who saw the 2008 housing crash coming while everyone else was buying McMansions? Yeah, he’s been buying put options against Nvidia and Palantir. When the “Big Short” guy starts betting against your favorite AI stocks, maybe it’s time to pay attention.
And it’s not just Burry. Peter Thiel’s hedge fund completely dumped their Nvidia position in Q3 – over 537,000 shares, gone. SoftBank liquidated their entire multi-billion-dollar stake in October. When the tech-savvy money starts heading for the exits, that’s usually not a great sign.
Tonight’s the Night
So here we are, waiting for Jensen Huang to either save the day or send everyone scrambling for the exits. In a market that’s been pricing in perfection, even a tiny miss or lukewarm guidance could trigger the kind of selling that makes grown investors weep.
On the flip side, a massive beat could send the stock rocketing toward new highs and restore everyone’s faith in the AI revolution. It’s basically a coin flip that could determine whether we’re heading into a correction or continuing this wild ride to even more ridiculous valuations.
The bottom line? One company’s quarterly report shouldn’t have this much power over the entire market, but here we are. Welcome to 2025, where artificial intelligence is real, but the market’s reaction to it might be the most artificial thing of all.
Buckle up, folks. Tonight’s earnings call isn’t just about Nvidia – it’s about whether this whole AI party keeps going or if someone’s about to turn on the lights and send everyone home.