TLDR
- Nvidia posts Q3 FY26 earnings Wednesday with Wall Street projecting $54.83 billion revenue, a 56.3% annual increase
- Bank of America analyst values shares at $275, noting 27x 2026 earnings multiple looks attractive
- Billionaire investors including Michael Burry and Peter Thiel dumped holdings, raising AI sector concerns
- Blackwell and Rubin chip orders totaled $500 billion for 2025-2026, topping estimates by 10-15%
- Analyst consensus shows 37 Buy ratings versus one Hold and one Sell rating
Nvidia delivers Q3 fiscal 2026 earnings Wednesday after market close. The chip giant’s performance will likely influence AI stock sentiment for weeks to come.
Analysts forecast $54.83 billion in quarterly revenue, marking 56.3% growth versus last year. Earnings per share should reach $1.25, up 54.3% from the prior-year period. The company has maintained strong momentum with Q2 showing 56% revenue growth and 61% earnings expansion.
Bank of America’s Vivek Arya keeps his Buy rating with a $275 price target. He finds the valuation appealing at 27 times 2026 earnings forecasts and 21 times 2027 projections. Arya recently adjusted his target calculation to use a 30x multiple on 2027 earnings instead of 44x on 2026 figures.
The analyst anticipates management will address investor concerns around AI infrastructure investment and chip supply dynamics. He interprets the stock’s recent decline after the GTC conference as encouraging before earnings.
High-Profile Investors Exit Positions
Several prominent investors have reduced or eliminated Nvidia exposure. Michael Burry established $1.2 billion in short positions against Nvidia and Palantir last quarter. Peter Thiel’s investment firm liquidated its complete stake of 537,742 shares during the July-September period.
Thiel’s Nvidia holding represented roughly 40% of his fund’s total portfolio before the sale. These moves highlight growing skepticism about AI stock valuations. Questions persist about whether massive infrastructure spending will generate proportional returns.
Nvidia revealed $500 billion in commitments for Blackwell and Rubin processors spanning 2025 and 2026. Orders exceeded analyst predictions by 10% to 15%. The company maintains its position as the sole merchant semiconductor provider with demonstrated large-scale AI cluster deployment capabilities.
Competitive pressures are building. OpenAI expanded its supplier base to include Broadcom and AMD. Google’s custom Tensor Processing Units are gaining market traction. These shifts could impact Nvidia’s pricing leverage and market dominance over time.
Critical Factors for Investors
Several metrics beyond top-line figures will shape market reaction. Forward guidance carries particular weight since it reflects management’s demand visibility. Any indication of decelerating growth could pressure semiconductor stocks broadly.
Gross margin trends matter too. Rising costs relative to revenue would challenge profit assumptions. Investors want clarity on customer diversification since heavy reliance on major cloud providers creates concentration risk.
Executive commentary on supply constraints and infrastructure capacity will receive close attention. Some market participants worry AI spending is racing ahead of revenue realization across the industry.
Wall Street maintains strong conviction on the stock. Among 39 covering analysts, 37 recommend Buy while one suggests Hold and one advises Sell. The average price target of $242 implies 27% appreciation potential. Shares have rallied 42% year-to-date.
Evercore’s Mark Lipacis predicts the company will exceed expectations and raise guidance. This sentiment dominates Wall Street thinking. However, lofty expectations mean solid results might still disappoint if they miss elevated targets.
Wednesday’s announcement will reverberate beyond Nvidia. Results will either confirm the AI infrastructure buildout thesis or intensify questions about investment timing and returns. Market participants are positioned for volatile reactions in either direction.
The stock commands premium valuations that price in continued strong execution. Given widespread AI sector investments, this quarterly report matters far beyond one company’s three-month performance. The results could reshape near-term sentiment across technology.
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