Is NVIDIA on a Continuous Rebound? This Earnings Report Has Become a Global Focus!

After the market closes on February 26th, NVIDIA, which ranks among the top in global market capitalization, will release its fourth-quarter earnings report.

The significance of this earnings report is self-evident. As the core driving force behind the recent rise in global assets, NVIDIA's performance has attracted much attention.

Its influence is not only limited to the stock market but may also lead to significant fluctuations in the global macro-economy and other major asset classes.

Recently, due to the market shock caused by DeepSeek, investors have raised doubts about the necessity and conversion efficiency of the high capital expenditures of AI giants.

On January 27th, NVIDIA's stock price plummeted by nearly 17% in a single day, causing market panic. However, it then began a strong rebound.

Starting from February 4th, it rose for five consecutive trading days, with a cumulative increase of 14% in the stock price. It slightly declined by 0.58% overnight, which is negligible.

The sentiment of investors bottom-fishing NVIDIA in the market has been growing stronger day by day.

With the anticipation of the release of this quarter's earnings report, NVIDIA is undoubtedly in the global spotlight now.

The Revolution from a Gaming Graphics Card Company to an Artificial Intelligence Empire

On May 30th, 2023, NVIDIA's market capitalization exceeded one trillion US dollars, making it the first semiconductor company in the world to join the "trillion-dollar club".

This graphics chip company, founded in an auto repair warehouse in Santa Clara, California, has completed a thrilling industrial transformation over the past 30 years.

While people are still discussing the ray tracing performance of the RTX 4090, NVIDIA has quietly built a computing power empire in the era of artificial intelligence.

Its GPU chips are driving the evolution of cutting-edge technologies such as ChatGPT, autonomous driving, and quantum computing.

This transformation has not only reshaped the landscape of the semiconductor industry but also revealed the survival code for technology companies to cross growth cycles.

Although it has a market capitalization of one trillion US dollars and has become a giant in the global AI industry, NVIDIA's challenges have just begun.

The Impact of DeepSeek! How Will NVIDIA Respond?

There is no need for me to elaborate further on the success of DeepSeek.

Some investors believe that DeepSeek has an extremely low training cost of only $5.576 million, yet its performance is close to that of OpenAI's o1 model, breaking the industry's ironclad rule that "high performance equals high computing power investment".

This achievement has made the market worried that DeepSeek's low-cost training method may reduce the demand for NVIDIA's high-end products such as the H100 and B200, thus impacting NVIDIA's business, especially disrupting its current high-profit margin situation.

However, later, with the market's further understanding of DeepSeek-R1 and the support of the capital expenditure plans announced by major technology companies, NVIDIA's stock price gradually began to recover.

The capital market is always full of uncertainties, and some investors still hold this view.

Because of the emergence of DeepSeek, NVIDIA's performance this year will be better than expected, and it is very likely to be reflected in its stock price.

Although DeepSeek's low-cost training has indeed reduced the consumption of high-end GPUs for a single model development, it will encourage more AI applications to participate in training and also generate broader computing power demand at the inference end.

The growth in demand will directly drive the demand for computing power infrastructure.

For example, technology giants such as Google, Meta, and Amazon have all stated that they will continue to increase their capital expenditures on cloud computing infrastructure.

NVIDIA has also responded that DeepSeek will bring them more demand and pointed out that the computing power demand in the inference link still highly depends on NVIDIA's hardware.

At the same time, the continuous expansion of the open-source ecosystem driven by DeepSeek may prompt more enterprises to participate in AI application deployment.

With the popularization of open-source AI models, third-party AI service providers will emerge, offering customized AI solutions for enterprises.

For example, companies like Oracle and IBM can attract a wider customer base by providing platforms that integrate open-source AI models. This will also expand the overall application volume of AI, thereby driving the demand for computing power.

What to Pay Attention to as the Earnings Report Release Approaches?

Before NVIDIA's earnings report is released, Lipacis has given its stock a rating of "tactically outperforming the market" and expects the company to release a "positive report and outlook" on February 26th.

He added, "We believe the biggest risk is that the delay of NVIDIA's Blackwell product may lead to a gap in shipments."

Although NVIDIA's stock price performance this year has been impacted by DeepSeek, Lipacis is not the only one who remains optimistic about NVIDIA's performance prospects.

UBS analysts said that they expect NVIDIA's performance in the quarter ending in January and the outlook for the quarter ending in April to be strong.

The earnings expectations for the Blackwell chip have already "turned upward", and at the same time, NVIDIA's product portfolio is shifting from Hopper to the newer Blackwell.

In this earnings report, we need to pay attention to the execution of Blackwell; and whether NVIDIA still has confidence in the fiscal year 2026/calendar year 2025 and can give us a good growth expectation.

Of course, I also look forward to NVIDIA talking about DeepSeek again.

Judging from the stock price trend chart, NVIDIA's current stock price is in a strong rebound stage.

There is still some room for further increase at the current price level. If investors want to bet on its earnings report expectations, I think it is possible, but they still need to invest with caution.$NVDA