Nvidia shares could see $300B swing tied to Q2 earnings: UBS
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Justin Sullivan
Shares of Nvidia (NASDAQ:NVDA) could swing around 10% after the AI chipmaker releases its Q2 results, UBS said Wednesday, as investors prepared to see if the company can exceed expectations for a surge in Q2 earnings and revenue.
Current options pricing showed traders are expecting a post-report move of around 10%, or a $300B swing with Nvidia’s (NVDA) market capitalization of ~$3.1T, Solita Marcelli, UBS’s Americas chief investment officer, said in a note. The Q2 report is due after Wednesday’s closing bell. Seen as a bellwether for AI investment and the broader market (SP500)(COMP:IND), Nvidia (NVDA) is also expected to offer better-than-anticipated guidance for further financial results, she said.
Goldman Sachs separately flagged that Nvidia (NVDA) options were implying a +/- 10% move after the Q2 report, higher than a four-quarter average of 7%. Analysts are looking for Nvidia (NVDA) to say its Q2 adjusted EPS and revenue each more than doubled over the past year, to $0.64 on $28.67B.
Nvidia’s (NVDA) report arrives after the stock has jumped ~28% following an August selloff that swept through the broader market. “We have said that future gains in global tech stocks should be more gradual after the quick rebound over the past three weeks, with potential headwinds from U.S. macroeconomic data and further news on semiconductor export controls likely contributing to rising volatility,” Marcelli said.
“However, we continue to hold a positive structural view on the broader AI theme,” she said.
UBS said investment in AI is set to continue growing, with Big Tech companies on course to increase their capital spending this year by 43% Y/Y. “However, the capex intensity—capex divided by sales —for big tech remains below their historical peaks,” Marcelli said.
UBS’ analysis shows Big Tech’s capex could grow by as much as 25% in 2025, “boding well for AI enablers in the semiconductors space,” she said.
ETFs holding Nvidia (NVDA) include (QQQ), (VOO) (XLK), (SOXX) and (SMH).