Nvidia's success in AI applications stems from its early bet on GPU technology, which revolutionized computer graphics and the PC gaming market. The company's performance is critical for investors, especially those holding S&P 500 index funds, as Nvidia accounted for over a fifth of the index's total return last year. The upcoming earnings report will be the first since DeepSeek's announcement, and Nvidia has acknowledged DeepSeek's advancements as compliant with export controls. Nvidia's quarterly earnings will be released after the market closes on Wednesday.
Key takeaways:
- Nvidia's earnings are crucial for the U.S. stock market as it is the second-largest company on Wall Street, significantly impacting the S&P 500 and other indexes.
- Wall Street expects Nvidia to report fourth-quarter adjusted earnings of 85 cents per share on revenue of $38.08 billion, with a net income of $19.58 billion.
- Nvidia's stock movement is vital due to its substantial contribution to the S&P 500 index's total return, accounting for more than a fifth of it last year.
- The company's quarterly earnings report follows a challenge from Chinese company DeepSeek, which claims to have developed a competitive AI model using fewer resources.