Nvidia (NVDA) shares fell around 2.6% to around $209 in early Monday trading as the chipmaker began its earnings week under pressure from a broader decline in technology and semiconductor stocks.
The S&P 500 fell 0.2%, while the Nasdaq Composite lost 0.5%. The Dow Jones Industrial Average was up 32 points, or 0.1%.
Chip stocks were among the biggest decliners. The iShares Semiconductor ETF dropped almost 3%.
Micron Technology fell more than 6%, while Advanced Micro Devices and Broadcom declined 3% and about 2%, respectively.
Other technology stocks also came under pressure. Sandisk dropped 9%, Intel declined 4%, and Seagate Technology fell 6%.
Nvidia will report its fiscal 2027 second-quarter results on Wednesday in what has become a key test for the broader artificial intelligence investment cycle.
The chipmaker is expected to beat consensus estimates of $2.09 in adjusted earnings per share and $91.96 billion in revenue.
Analysts expect strong Nvidia results
Rosenblatt Securities reiterated a Buy rating and $325 price target on Nvidia ahead of the earnings report.
The firm expects the second-quarter results to act as a positive catalyst for the stock, with revenue and earnings expected to exceed consensus estimates.
Rosenblatt also expects Nvidia’s third-quarter revenue and earnings guidance to come in above consensus expectations.
The firm pointed to the company’s continued momentum and leadership in artificial intelligence, while maintaining its view that Nvidia will continue to deliver strong performance.
Cantor Fitzgerald also reiterated an Overweight rating on Nvidia on Monday and maintained a $350 price target.
The firm said investors remain underweight the stock and expects Nvidia shares to move rapidly once the stock begins to rise. Nvidia remains one of Cantor Fitzgerald’s top picks.
The firm identified several potential catalysts that could support the shares.
One is a formal update on Nvidia’s data center revenue outlook for 2027.
Cantor noted that other companies have already provided specific targets for that period, while Nvidia has not.
The firm also pointed to potential developments involving Anthropic ahead of its expected fourth-quarter 2026 initial public offering.
Greater visibility into hyperscale and other capital expenditure plans for 2027 and 2028 could also provide support for Nvidia, according to the firm.
Cantor additionally cited continued strong growth among neocloud companies and increasing confidence in graphics processing units becoming a standardized asset class through new financing agreements.
Earnings set to test AI investment cycle
Nvidia’s results will arrive after a period of increased scrutiny around the sustainability of AI infrastructure spending, competition and financing arrangements across the industry.
The company remains central to the AI infrastructure trade, making its quarterly results an important indicator for investors assessing whether current levels of spending can continue.
The earnings report will provide a key test of Nvidia’s ability to convert continued AI infrastructure investment into revenue growth while addressing investor concerns around financing, competition and the sustainability of spending across the sector.
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