On Thursday, the financial report that determines the fate of the global market is here!

The global market is falling into a dangerous collective anxiety, and the only one that can break this deadlock is likely NVIDIA. This chip giant, with a market value of $4.5 trillion, will announce its third-quarter financial report after the U.S. stock market closes on Wednesday (Thursday morning Beijing time), and this report will determine the direction of the global market in the last few weeks of this year.

Currently, market tension is spreading: from Bitcoin to tech stocks, from gold to government bonds, from the private equity market to corporate bonds, almost all asset classes are facing selling pressure. In this context, investors are focusing on NVIDIA, which is both hope and helplessness. The company's performance will directly reflect the real returns of the hundreds of billions of dollars invested in AI by tech giants.

At present, Wall Street analysts are generally optimistic about NVIDIA's upcoming financial report, expecting both net profit and revenue to grow by more than 50%.

Analysts point out that if investors are satisfied with NVIDIA's third-quarter performance and fourth-quarter guidance, the bulls will drive the market to a positive close; if not, the market may face a deeper adjustment. As Wall Street insiders say, "This is a report on how NVIDIA performs, and how the market performs."

It is worth noting that under the highly concentrated risk in the market, NVIDIA, as the largest weighted stock in the S&P 500 index and the center of AI trading, has an unprecedented importance in its performance. However, some market participants point out that concentration risk is exciting when the market is rising but can turn into a nightmare when it is falling.

NVIDIA: The Only Savior in the Current Market?

A more gloomy sentiment is spreading in the market, and only NVIDIA can break this gloom.

The most speculative areas of the financial market are currently under pressure. Bitcoin—possibly the purest indicator of speculative enthusiasm—has fallen 29% from its peak and has turned negative this year.

The stock prices of companies holding and storing Bitcoin are in serious trouble. Among them, the largest, Strategy (formerly MicroStrategy), has seen its stock price drop by more than 30% this year, down more than 50% from its summer peak.

Unprofitable American tech companies have been sluggish for weeks, indicating that investors, even risk-taking retail investors, are starting to lose patience with the hype.

Even more unsettling is that the turmoil is not limited to the more aggressive sectors of tech stocks. Meta, the parent company of Facebook, has seen its stock price flat this year, erasing a quarter of its market value since August, as investors are uneasy about its seemingly endless spending on artificial intelligence.

Although the pressure in the private equity market is not always easy to detect, a series of explosive events over the past few months has already touched the nerves of the market. The index compiled by Absolute Strategy Research tracking companies like Blackstone and KKR has fallen 13% this year, in stark contrast to the S&P 500 index.

Analysts point out that the significant rise in the benchmark U.S. stock index has clearly masked many issues. Beneath the surface, investors are becoming harder to please. The obvious risk is that this could evolve into a comprehensive liquidation of a market that has been hopeful since this spring.

In this market environment, the importance of NVIDIA's earnings report is increasingly highlighted.

Despite recent sell-offs, NVIDIA's stock price has risen 35% this year, more than double the Nasdaq 100 index's increase of about 17%.

At the same time, the drop in stock price has made the company's valuation relatively attractive. NVIDIA's current forward price-to-earnings ratio is about 29 times, well below its 10-year average of 35 times, and slightly above the Nasdaq 100 index's level of about 26 times.

"Given NVIDIA's growth rate, a 30 times price-to-earnings ratio seems hardly excessive," said Scott Martin, Chief Investment Officer at asset management firm Kingsview Wealth Management.

For the upcoming earnings report, Wall Street analysts expect NVIDIA's net profit and revenue for the third quarter to both grow by more than 50%.

Data compiled by Bloomberg shows that Microsoft, Amazon, Google, and Meta together account for more than 40% of NVIDIA's sales, and their AI spending is expected to grow by 34% over the next 12 months, reaching $440 billion. Therefore, the company's performance will directly reflect the real returns on hundreds of billions of dollars in AI investments.

Analysts point out that if investors are satisfied with NVIDIA's third-quarter performance, the bulls will drive the market to a positive close; if not, the market may face a deeper adjustment. As Martin said:

"This is an earnings report where 'NVIDIA's performance determines the market direction.' If NVIDIA's performance is strong, with expected sales and activity levels larger, then everything will improve."

Wall Street Bets on Earnings Report "Exceeding Expectations Again"

Wall Street investment banks generally hold an optimistic view of NVIDIA's earnings report.

According to Hard AI News, JPMorgan pointed out in its latest research report that NVIDIA is very likely to once again perform a "beat-and-raise" act. The bank expects third-quarter revenue to exceed the market's general expectation of about $55 billion, providing a performance guidance of up to $63 billion to $64 billion, significantly higher than the market expectation of $61.5 billion

JP Morgan stated that the current growth rate of NVIDIA is not determined by demand, but rather by the capacity limits of its vast supply chain. The demand for AI computing power continues to significantly exceed supply, and NVIDIA's largest customer base, including hyperscale cloud service providers, emerging cloud computing companies, and AI laboratories, still faces computing power bottlenecks.

The supply chain capacity is rapidly expanding. JP Morgan expects that the shipment volume of Blackwell/Blackwell Ultra racks in the third quarter achieved approximately 50% quarter-on-quarter growth, reaching a scale of about 10,000 racks, and this growth momentum is expected to continue into the fourth quarter. The bank anticipates that NVIDIA's total rack shipments for the entire fiscal year 2026 will reach 28,000 to 30,000.

More importantly, according to information disclosed by NVIDIA at the October GTC conference, its order backlog for the calendar year 2026 has already exceeded 70,000 racks, surpassing the maximum production capacity for the entire next year. Based on this, JP Morgan maintains its "overweight" rating on NVIDIA, with a target price of $215.

JP Morgan also stated in its research report that investors should closely monitor how management responds to four core concerns:

First is the capacity ramp-up trajectory of Blackwell/Blackwell Ultra, especially the speed of capacity expansion entering the first half of 2026 (i.e., the first half of NVIDIA's fiscal year 2027).

Second is the sustainability of AI spending. JP Morgan's global team recently concluded in a report that funding sources in the AI sector will remain abundant by 2030.

Third is the impact of power restrictions. It is expected that about 120 gigawatts of data center power capacity will come online globally in the next five years, but the delivery cycle for new gas turbines has surged to 3-4 years, while the construction cycle for nuclear power plants exceeds 10 years, making power a real bottleneck.

Finally is the impact of component cost inflation on gross margins. JP Morgan believes that rising LPDDR memory prices are a greater pressure point than HBM memory. Nevertheless, the bank believes that NVIDIA still has the ability to achieve its gross margin target in the mid-range of 70% by the end of fiscal year 2026.

According to Zhui Feng Trading Platform, Morgan Stanley is more optimistic, raising NVIDIA's target price to $220. Analyst Joseph Moore stated in a report on November 14 that industry research shows a substantial acceleration in demand, and NVIDIA has fully resolved early rack-related issues, while demand continues to surge.

Morgan Stanley's industry research indicates that demand signals from NVIDIA's customers and suppliers in the third quarter point to accelerated growth, contrasting sharply with the market's general expectation that NVIDIA's various growth indicators have peaked At the customer level, the expected capital expenditure for cloud services in the third quarter has been raised to $142 billion, with each of the four major hyperscale cloud service providers increasing by more than $20 billion. Compared to the growth in dollars for 2025, it has currently reached $115 billion, which is $6 billion higher than a quarter ago.

From the supplier's perspective, ODM manufacturer Quanta expects its AI server revenue to accelerate growth in the first quarter of 2026, with a year-on-year increase of over 100%. To support this demand, Quanta plans to double its AI server production capacity next year, as order visibility has extended to 2027.

Morgan Stanley has raised its revenue expectations for NVIDIA for the October quarter from $54.4 billion to $55 billion, and for the January quarter next year from $61.2 billion to $63.1 billion. Analysts point out that achieving a quarterly sequential growth of $8 billion in both the October and January quarters would set a historical record for the industry.

However, deep market concerns are hard to dissipate

Despite Wall Street investment banks generally being optimistic about NVIDIA's earnings report, concerns about AI investments are deepening, and these worries have already been reflected in investor behavior.

According to a previous article from Wall Street Insight, Peter Thiel's hedge fund sold all of its NVIDIA shares in the third quarter. SoftBank Group also exited its holdings to fund other AI investments.

Famous for shorting the real estate market during the 2008 financial crisis, “Big Short” Michael Burry's Scion Asset Management disclosed that it bought put options on NVIDIA, with Burry warning that there is a bubble in AI.

At the same time, Bloomberg's analysis of the 13F filings of 909 hedge funds found that the number of funds increasing and decreasing their positions in NVIDIA was almost balanced in the three months ending September 30. Jonestrading's chief market strategist Michael O'Rourke stated:

"These participants in the AI field have been tirelessly raising the expectation bar, and now they not only have to deliver on the numbers but also continue to meet the market's rising expectations, which is a dangerous game for public companies."

Moreover, the key risk currently facing the market is that if large AI spenders, particularly the private company OpenAI, have to scale back their commitments, these numbers may become unreliable.

Visible Alpha's head of technology research Melissa Otto pointed out: "I think the market is really struggling with the total potential market size of all this AI infrastructure right now." Allspring Global Investments portfolio manager Jake Seltz stated that the company holds a large position in NVIDIA, and he will closely monitor the guidance for the next quarter. Although the revenue guidance may exceed market expectations, "it is difficult to know how conservative their guidance will be."