Nvidia Set to Release Q1 Earnings Amid Market Uncertainties
After the market closes on Wednesday, Nvidia is set to disclose its earnings for the first quarter of fiscal year 2026, which concluded on April 27. Investors and analysts are keenly awaiting this report, particularly in light of the recent fluctuations surrounding U.S. chip export regulations and their potential effects on Nvidia’s international business operations.
Key Focus: GB200 NVL72 Hardware
While the impact of export controls on Nvidia’s business may be a focal point for some, industry expert Kevin Cook, a senior equity strategist at Zacks Investment Research, emphasizes a different perspective. Cook, who has been monitoring Nvidia for ten years, argues that the company’s recent launch of its GB200 NVL72 hardware holds greater significance for investors.
The GB200 NVL72, an innovative single-rack exascale computing system, began shipping in February and features 72 GPUs at a price point of approximately $3 million. Despite the high expectations surrounding this product, Cook notes that the recent turbulence involving DeepSeek in January led several analysts to reduce their delivery forecasts significantly.
“This quarter marks the first time Nvidia has shipped the GB200 NVL72 units, so metrics for performance are still developing,” Cook explained. “If CEO Jensen Huang announces plans to deliver 10,000 units in Q2, it would greatly impress the market. This target translates to a potential revenue of $30 billion from this $3 million product. However, I anticipate they will deliver fewer than 5,000 units.”
Demand for AI Technology
This earnings report could unveil insights into corporate demand for cutting-edge AI technologies. The key question remains: will enterprises upgrade their AI hardware with each new release, similar to consumer trends seen with smartphones? Cook expressed uncertainty about this trend but underscored its importance for Nvidia’s future.
Short-Term Volatility vs. Long-Term Growth
According to Cook, Nvidia’s stock is likely to experience immediate fluctuations based on the company’s statements regarding U.S. export controls. However, he believes these factors will not fundamentally alter Nvidia’s long-term valuation, particularly in comparison to the anticipated demand for the GB200 NVL72.
“Nvidia has shown resilience to short-term market reactions,” Cook explained. “After the announcement of chip export restrictions, there was a sharp decline followed by a swift recovery. This resilience sets Nvidia apart from many competitors who encounter consistent challenges.”
Despite the ongoing export restrictions impacting China, Cook contends that Nvidia successfully finds customers elsewhere. The firm continues to engage with major hyperscalers and is expected to maintain robust demand for its AI chips. Furthermore, recent developments, such as Stargate’s project in the Middle East, present additional growth opportunities for Nvidia.
Conclusion: Deliveries and Future Outlook
Ultimately, Cook argues that the key indicator for Nvidia will be the performance of its GB200 NVL72 units. “As long as delivery expectations remain steady to strong, any revenue fluctuations in this quarter will likely be overshadowed by the favorable trajectory for Nvidia throughout the year,” he concluded.
As investors await Nvidia’s earnings report, the focus will likely be on both the anticipated delivery numbers for the GB200 NVL72 and the company’s response to evolving market conditions surrounding export controls.
