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Nvidia CEO Jensen Huang prepares to report second-quarter earnings as investors weigh AI trade expectations

Nvidia is set to report its second-quarter earnings on Wednesday after the bell, a move highly anticipated by Wall Street as a referendum on the entire AI trade. The company, led by CEO Jensen Huang, is expected to report revenue of $92 billion, representing a 96% year-year jump. Investors are currently navigating an 'expectations premium' where the company must surpass high forecasts following a period of which the stock experienced its longest losing streak since 2022. While the company remains the world's largest company by market cap, concerns persist regarding its heavy dependence on hyperscalers like Amazon, Google, and Microsoft. Additionally, Nvidia has signaled plans to hike prices by as much as 15% next year for servers with its AI chips due to rising memory costs. Despite recent volatility, analysts remain bullish, with some projecting a target price of $350, significantly higher than current trading levels.

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