Nvidia's second quarter earnings are nearly here, and the report is set to do more than show another big quarter. Wall Street expects the chipmaker to post adjusted earnings of $2.09 a share on revenue of $92 billion, a result that would mark a 96% jump from a year earlier and give investors a fresh read on whether the AI trade still has room to run.
Daniel Howley, in a note to readers, framed the coming report as a market test rather than a routine update, and that is exactly how it is being treated. His Yahoo Finance report at [email protected] and @DanielHowley on X points to a quarter that could reset expectations for Nvidia and chip stocks after a rough stretch for the group.
The biggest reason the number matters is that Nvidia now sits at the center of the cloud buildout. The company updated its reporting framework last quarter, splitting Data Center revenue into sales to Hyperscalers and AI Clouds, Industrial, and Enterprise, while folding PC, game console, workstation, robotics and automotive revenue into Edge Computing. Based on the latest estimates, Data Center revenue is expected to top $85.4 billion, up 107%, with Hyperscaler revenue at $43.5 billion and ACIE sales at $41.7 billion. That means Nvidia still gets the majority of its revenue from Hyperscalers such as Amazon, Google and Microsoft.
Those customers have not exactly made the market comfortable. Microsoft, Amazon and Google helped allay some fears with strong cloud growth, but Google and Meta still spooked investors with heavier spending. That split matters because Nvidia's results are being judged against the question hanging over every AI budget: whether the spending is turning into returns fast enough to justify the pace.
Nvidia added to the stakes earlier this month by saying it is working with BlackRock, Blackstone, KKR, Apollo, Brookfield and Goldman Sachs on a $500 billion pool of capital. It also said it is backing SB Energy and OpenAI's effort to build an 8-gigawatt data center in Ohio with up to $150 billion. Those plans show how deeply the company is woven into the next phase of AI infrastructure, but they also raise the bar for proof that demand is still broadening, not just being financed.
Chip stocks have struggled to hang on to gains over the last month after July's steep declines, and that leaves Nvidia with little room for an ordinary beat. If the company lands near the $2.09 EPS and $92 billion revenue marks, investors will likely read it as another sign that the AI boom is still doing the heavy lifting for Big Tech. A miss would not just knock the shares; it would invite a harder question about whether the market has already priced in too much of the future.
