NVIDIA profits can move 6 % with AI Boom and Rina Tensents waving on the horizon

Investors are preparing to obtain the latest quarterly results of the company due after the closing of the Wednesday market, with the trading in NVIDIA options Which means expectations The stock will move by 6 %, or up or down-for example, to a change of $ 260 billion in the market value of NVIDIA.

In the three months that the last time the company gave investors a quarterly update, in May, NVIDIA shares rose by 35 %. But the tension surrounding what is already the most watched profit of this season has increased by recent tensions about what some concern is A dangerous financial bubble In traumatic arrows artificial intelligence. The uncertainty about the Chinese NVIDIA works is still looming on the horizon.

Wall Street analysts are looking for Nafidia Q2 Revenue for an increase of 53 % year to $ 46 billion, at the end of NVIDIA, with $ 1.01 arrow profits. Data center sales, which are the essence of NVIDIA’s business, are expected to come approximately $ 40 billion. But with NVIDIA shares a lot in recent months, Miss can be sent on Wednesday, or cautious guidance associated with China’s restrictions, to send shares.

Nvidia in the American -Chinese Crosshairs

NVIDIA may remain one of the greatest beneficiaries of the Tructured IQ, but an important part of the company’s business has also become geopolitical football as the United States and China are competing for technological dominance. In April, Washington began requesting export licenses for the company’s H20 chips-renewable versions of artificial intelligence chips in NVIDIA, which were specifically designed to comply with the US export controls that entered into force in late 2022 and were tightened again in 2023. Fees of $ 4.5 billion in the first quarter Associated with unnoticed obligations and purchase.

From there, things became more complicated only for Chinese NVIDIA work. After Nvidia Jensen Huang visited President Trump in Mar Lago, the White House said he would allow the company to sell H20S after all. NVIDIA applied for export licenses, but it faced extensive delays, thanks to the most striking position of the United States and Chinese buyers hesitated to commit to buying. Then, earlier this month, NVIDIA and AMD concluded a deal with the Trump administration to grant Licensing in exchange for revenue sharing by 15 % Arrange on China chips sales.

But with the resumption of shipments of H20 chips, China began to discourage companies from buying them, expressing fears that the information that customers ask to provide to review the US government may contain sensitive information. According to the Chinese government, the Chinese government has found evidence that the NVIDIA chip may contain background devices that would allow us to extract data agencies on how to use it. In addition, comments from US Minister of Trade Howard Lottennik are about providing China with the “fourth best chips” in NVIDIA “deep insult” by Chinese officials, according to what he said. Financial times.

Finally, last week Huang Declare In Taipei, NVIDIA began to reduce the production of the H20 chip and began working on a more powerful successor, saying that the company was working to provide a “new product for artificial intelligence data centers”, modified to reduce some of its performance, as required by the United States. He said he was seeking the Trump administration’s approval to sell the slide.

“It is up, of course, the United States government,” said Huang. “We are in a dialogue with them, but it is too early to know.”

As a result of all uncertainty, analysts expect that NVIDIA will not hurt China’s revenues in the profit report.

“I think they will not count, and they do not expect China’s revenues, there is a lot of uncertainty,” said Karl Fronund, a founder and main analyst in Caprien-I Research.

Jack Gold, a founder and main analyst at J luck NVIDIA now has two basic groups to please: stock and Trump management campaign. He said: “They fell between a rock and a difficult place.” “It is a really strange situation we are now where the government in the United States has their hands in the pockets, in the governor of these companies.”

The problem of the artificial intelligence bubble

Besides political geography, NVIDIA faces another challenge: the hammer that the mutation of artificial intelligence began to appear to be a bubble. This would strike at the heart of NVIDIA’s business and evaluation of the strategy-the company’s trading at more than 40 times its expected profits-which depend on the continuous demand for strong graphics processing units. NVIDIA growth is largely concentrated in a handful of cloud giants, including Deadand Amazonand Google and MicrosoftIn addition to highly funded startups such as Openai. If these companies slow up spending, NVIDIA suddenly loses their largest buyer.

“I think everyone is concerned about the artificial intelligence bubble,” Frung said, although he added that these fears have already lasted three years ago. He confirmed that he did not believe that he would be doing now. “I think there are still two to five years of remaining growth,” he said.

Gold agreed, saying that “there are at least several quarters, if not a few years of good profits” for NVIDIA, but he warned at some point, if the market is disrupted, then this money spent on chips will disappear.

“It matters to me,” he said. “This time, I am sure that the profits will remain great – (NVIDIA) sells everything you can build at a mockery of sarcophagus, and this is a good thing, if you can get away from that.” But from the point of view of the broader market, he added that the construction of the huge artificial intelligence data center “cannot continue forever.”

This is the reason, Frend, HUANG, said in fact to attract the investor’s attention to move from the point of view of the data center to other areas of NVIDIA’s business, including its work for cars and robots: “This is his game now, and how to make investors turn into a more comprehensive vision of artificial intelligence while moving from the data center and in the real world.”

But these investors are likely to be more interested here and now – tomorrow numbers appear. Let the clock parties start.