Nvidia’s Q2 Earnings Faceoff: Bubble Fears and Chip Delays Threaten Expectations

Nvidia stares down the earnings barrel as supply chain snarls meet AI hype cycle skepticism.

The Chipmaker's High-Wire Act

Supply constraints hammer production timelines while analysts question sustainability of current valuations. Every delayed shipment amplifies revenue risk.

Wall Street's Reality Check

Whisper numbers suggest modest beats won't satisfy market appetite—investors demand blowout results to justify premium multiples. Another 'guidance raise or die' moment for tech valuations.

Bubble Talk Grows Louder

Short interest climbs as skeptics point to stretched inventories and speculative positioning. The 'AI infrastructure trade' faces its first fundamental test since going mainstream.

Because nothing says 'healthy market' like everyone betting the farm on one company's ability to ship enough silicon to keep the dopamine hits coming.

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However, the mood in the market is cautious. Nvidia shares have been volatile this week, sliding 3.5% last Tuesday after comments from OpenAI’s CEO raised concerns about an AI bubble. Adding to pressure, an MIT report suggested that most companies investing in generative AI have yet to see returns. That has weighed on tech broadly, with the Nasdaq down more than 7% in recent sessions.

Nvidia Balances Supply Strains and Export Rules

At the same time, Nvidia is working through its own operational challenges. The company’s new Blackwell-based GPUs have faced production delays tied to partner Taiwan Semiconductor Manufacturing Co. (TSM), and some analysts warn that full-scale shipments may not land until later next year. These supply constraints could influence the company’s ability to meet rising demand.

Geopolitical issues are also in play. CEO Jensen Huang confirmed last week that Nvidia is in talks with the TRUMP administration about a next-generation AI chip for the Chinese market. The proposed B30A chip would deliver roughly half the computing power of the flagship B300 to comply with export rules. This comes as the company and Advanced Micro Devices (AMD) face a 15% revenue-sharing requirement on advanced chip sales to China, adding another layer of complexity to growth plans.

Is Nvidia Stock a Buy, Sell, or Hold?

Despite these hurdles, analysts remain broadly positive. Out of 39 ratings, 35 analysts rate NVDA shares a Buy, culminating in a Strong Buy consensus. The average NVDA stock price target stands at $198.57, about 11.5% above the current price of $177.99.

Still, with high expectations and sensitive headlines, the upcoming earnings call will be pivotal. Investors want proof that Nvidia can sustain growth while managing supply, regulation, and a market debating whether AI is a boom or a bubble.