To The Moon

Not Expected.

The results were in, $NVIDIA(NVDA)$ dutifully released their Q2 2026 earnings after US market closed on Wed, 27 Aug 2025.

Despite hitting the marks on both top and bottom line, its stock fell in post market trading (more about that later).

Q2 Earnings.

Earnings compared with estimates from analysts polled by LSEG:

• Earnings per share:  $1.05 adjusted vs $1.01 estimated vs vs Q2 2024’s $0.68; that’s a +54.41% YoY gain.

• Revenue: $46.74 billion vs $46.06 billion estimated vs Q2 2024’s $30 billion; that’s a +55.8% YoY growth.

• Net income: came in at $26.42 billion vs Q2 2025’s $16.6 billion, that’s a +59% YoY gain. 

• Gross margin (include H20 related charges): was 72.7% vs Q2 2025’s 75.7%, that’s a -3.0% YoY decline.

Overall performance.

Year-over-year revenue has now exceeded 50% for 9 consecutive quarters, dating back to mid-2023, when generative AI boom started to show up in Nvidia’s results.

Q3 2025 Guidance / Outlook.

(1) Revenue.

Guidance / outlook for Q3 2025 will be about $54 billion, ± 2%.

Meaning — in the worst case -2% scenario, revenue stands at $52.92 billion, with qualifier that forecasted-revenue does not assume any H20 sales to China.

According to LSEG, analysts were expecting revenue of $53.1 billion.

For Q3 2025, NVDA has ‘confirmed’ that sales growth will remain above 50%, a “strong” signal to Wall Street that demand for AI infrastructure shows no sign of fading.

H20 Chip.

As expected NVDA addressed the “issue” surrounding its payout to US government on the H20 chip.

It was a surprising find, and I am still wondering whether the revelation was the reason for its post-market trading decline?

After all, H20 was custom built solely for sales to China.

Previously the company has said that:

• It cost them $4.5 billion in write-downs when Trump outright forbad its sales to China.

• Otherwise, it would have been an $8 billion Q2 sales revenue, had it been commercially available.

It was a surprise revealed yesterday that NVDA sold no H20 chips to China during Q2 2025.

Luckily, it managed to benefit from the release of $180 million worth of H20 inventory to a customer outside of China.

Geopolitically environment permitting, CFO Colette Kress said that:

• NVDA could ship between $2 - $5 billion in H20 revenue during Q3 2025.

• By the end of the decade, NVDA expects AI infrastructure spending to be between $3 - $4 trillion.

Share Repurchase.

To further inject ‘positivity’ into NVDA, the company annouced that it had:

• Repurchased $9.7 billion in its stock during Q2 2025.

• NVDA’s board has approved an additional $60 billion in share repurchases, with no expiration date.

Stock Movement.

To drum up excitement, CEO Jensen Huang even touted the possibility of bring NVDA’s latest “advanced” AI processor chip - the “Blackwell” to China as he urges US government to open up access for American chipmakers.

Unfortunately this time round, the story teller did not manage to excite the market a bit.

Just look at its stock price for the entire week - prior & post quarterly earnings release. (see below)

As of 30 Aug 2025

• NVDA's stock price for week ending Fri 29 Aug 2025, exhibited a volatile response to its “strong” Q2 earnings.

• It started the week at $178.32 per share.

• Its earnings were announced on Wed, 27 Aug 2025 after market closed.

• When US market closed for the week, NVDA was at $174.18 per share.

• All in all, it lost about -2.32% or -$4.14.

Why ?

• Data center revenue is Nvidia’s biggest business, but actual sales ($41.1 billion) were just below Wall Street forecasts (as per StreetAccount estimate of $41.34 billion).for this segment, disappointing investors who expected stronger growth.

• Competitive pressures from companies like $Advanced Micro Devices(AMD)$ and $Arista Networks(ANET)$ are stepping up, that could affect Nvidia’s future margins and market share.

• Slowing Revenue growth has been detected by analysts’ scrutiny.

• Latest Q2 earnings marked NVDA’s slowest period of growth in its 9 straight quarters of YoY revenues.

• Cerebras (CBRS), new US AI chip maker. When rival AI chip maker decides to IPO, it will become a realized threat to NVDA. I have covered this ‘new kid on the block’ in 2 separate posts. It “unique” chip architecture performance rivals NVDA’s. Click here ! to read about it.

In my previous post (click here ! for details, help to Repost ok, tks) - I have shared that the Chinese government has encouraged self-sufficiency, and rely on locally produced AI chip.

There’s more news coming out from China. (see below)

• Chinese semiconductor firm Cambricon posted record profit in H1 2025, underscoring how local challengers to NVDA are gaining traction as Beijing looks to boost its domestic industry.

• Cambricon is among many Chinese companies, vying to be an alternative to American giant NVDA, when it comes to providing the chips required to train and run AI applications and models.

• Its revenue surged more than 4,000% YoY to RMB 2.88 billion (US$402.7 million).

• For now, its pale by comparison to NVDA’s massive $46.76 billion revenue.

• Cambricon’s revenue highlights how Chinese tech companies are vying to be the alternative, eliminating once and for all, threats that they could be cut off from American technology.

US Market.

On Wednesday, 27 Aug 2025 Nvidia's market capitalization was around $4.43 trillion , making it the most valuable publicly traded company globally.

It accounts for roughly 8.0% of S&P 500 index, making it a very influential stock within both S&P 500 and the Nasdaq indexes, given its leadership role in AI chip technology.

Options traders expect NVDA's stock price to potentially fluctuate by about 6% (around $260 billion in market value) following its Q2 2025 earnings.

This significant (expected) movement in NVDA could continue to cause corresponding volatility in both the S&P 500 and Nasdaq.

Nvidia's heavyweight presence in S&P 500 and strong ties to the tech-heavy Nasdaq, its stock price direction is likely to influence these indexes markedly on Thursday's session.

NVDA cont’d to slip in September 2025 ?

Short-Term Technicals:

• NVDA’s technical signals remain mixed.

• Long-term indicators still show a “Buy” with latest moves downgraded its outlook to “Buy”, from 'Strong buy'.

• Current support expected around $171. Risk of extended downside persists if the stock closes below $175 in the coming week.

US Economic reports:

• US market will be watching for broader US macro cues given the recent pullback in large-cap tech stocks.

• If NVDA can settle above key technical levels (around $182.70), bullish momentum may resume.

• If not, further correction toward $168 or lower is possible in September (most bearish month in US stock market history).

With its Q3 guidance and potential headwinds laid bare, will a dip equals to a “Buy” ? Dare to jump in or wait for next week jobs reports (release) to get “better” Buy-price ?

Remember to check out my other posts. (See below). Help to Repost ok, Thanks.

Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks.

• US PCE - Rally US Mkt & Cuts Interest Rate? Fri, 29 August. Pick post.

• AEXA, Chamath Palihapitiya Risky $250m SPAC ! Fri, 29 August. Idea post.

• LCID - Stock Split Is a Red Flag Warning ? Thu, 28 August. Pick post.

• Do you think it’s better to buy NVDA before US personal consumption expenditure (PCE) report is out’?

• Do you think its more prudent to hold off any purchase until after PCE report is out ?

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