Nvidia is set to report fiscal 2026 third-quarter earnings after market close on Wednesday, a highly anticipated announcement that could validate or challenge the sustainability of the artificial intelligence investment boom as concerns about an AI bubble intensify following high-profile investor exits.
The chipmaker faces mounting scrutiny over whether AI demand justifies current valuations amid warnings from prominent executives that substantial capital deployed in the sector may fail to deliver expected returns.
Analysts anticipate revenue of $55.2 billion, up 57 percent year over year, with adjusted earnings per share of $1.26, up 55 percent from a year earlier, according to consensus estimates.
The announcement comes as options markets price in a potential 7 percent stock swing in either direction, while major investors, including Peter Thiel's hedge fund, SoftBank, and Michael Burry, have exited or bet against Nvidia positions during the third quarter.
What Are Analysts Expecting From Nvidia's Wednesday Results
Wall Street consensus projects Nvidia will report $55.2 billion in revenue for the fiscal third quarter ending October 2025, representing 57 percent growth compared to the same period in fiscal 2025.
Adjusted earnings per share are expected to reach $1.26, reflecting 55 percent year-over-year growth as the company continues benefiting from unprecedented demand for AI accelerators across hyperscale data centers.
Nvidia's guidance for the current quarter will be equally important, as investors seek confirmation that AI infrastructure buildouts will sustain momentum through 2026.
The results will offer critical insights into Blackwell GPU production ramp and customer adoption rates, as Nvidia transitions from its Hopper architecture to the more advanced Blackwell platform.
Analysts will scrutinize gross margin trends, supply chain constraints, and geographic revenue distribution to assess whether the company can maintain its dominant position amid rising competition from AMD, hyperscalers' custom silicon efforts, and geopolitical tensions affecting chip exports.
Any signs of demand softening or production delays could trigger the 7 percent downside move that options traders have priced into the stock.
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Options markets are pricing in a potential 7 percent stock swing in either direction for Nvidia following the Wednesday earnings announcement, reflecting unprecedented uncertainty about whether AI demand justifies current valuations amid warnings from CEOs including Goldman Sachs' David Solomon and Google's Sundar Pichai.
Why Did Major Investors Exit Nvidia Positions This Quarter
Peter Thiel's hedge fund, Thiel Macro LLC, sold its entire Nvidia stake of 537,742 shares during the third quarter, representing nearly 40 percent of its portfolio, according to regulatory filings.
The complete exit signals growing caution about AI valuations from one of Silicon Valley's most prominent investors, particularly given Thiel's history of identifying technology bubbles before they burst.
SoftBank offloaded 32.1 million shares worth $5.8 billion in October to fund AI infrastructure projects, redirecting capital from Nvidia equity positions toward direct investments in data center buildouts and AI application companies.
Michael Burry's Scion Asset Management disclosed put options with a notional value of about $187 million against Nvidia, though he has since shut down his hedge fund.
These exits reinforced concerns about an AI bubble, with Goldman Sachs CEO David Solomon warning in October that there will be a lot of capital that was deployed that didn't deliver returns.
Google CEO Sundar Pichai told the BBC that no firm is immune if the AI bubble bursts, drawing explicit comparisons to the dotcom-era excesses when massive capital investments preceded a prolonged market correction.
How Will Results Affect Samsung and SK Hynix's Strategy
The earnings announcement is particularly significant for Korean chipmakers Samsung Electronics and SK Hynix, whose high-bandwidth memory expansion plans depend on sustained demand for Nvidia's AI accelerators.
SK Hynix dominates the HBM market with a 62 percent share, while Samsung holds 17 percent, according to industry analysts.
Both companies are scaling up capacity, with Samsung resuming construction on its P5 line in Pyeongtaek with operations targeted for 2028, and SK Hynix expediting its M15X fab in Cheongju to meet anticipated demand.
The timing is critical, as Nvidia's next-generation Rubin GPU architecture, which has already taped out at TSMC, is expected to begin mass production in the third quarter of 2026.
This timeline coincides with when Samsung and SK Hynix's new fabs become operational, meaning Rubin-based GPU availability and adoption rates could significantly influence capacity utilization.
If Nvidia's guidance suggests slower than expected Rubin ramp or reduced HBM requirements, Korean chipmakers may need to recalibrate multi-billion dollar expansion plans that assume continued exponential growth in AI accelerator demand.
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What Timeline Exists for Nvidia Rubin GPU Production
Nvidia's Rubin GPU architecture has already completed tape out at TSMC and entered fabrication using the foundry's 3-nanometer process family with HBM4 integration, according to company statements and supply chain reports.
Mass production is scheduled for the third quarter of 2026, though some analysts suggest production could begin earlier if trial manufacturing proceeds without complications.
Nvidia CEO Jensen Huang confirmed during his recent Taiwan visit that the company has six different Rubin chips, including new CPUs and GPUs, being prepared for trial production at TSMC facilities.
The Rubin platform represents a ground-up redesign incorporating a dedicated CPU, GPU, scale-up NVLink switch, and silicon photonics processor components aimed at meeting the computational demands of next-generation AI models.
TSMC increased 3-nanometer process production capacity by 50 percent to accommodate Nvidia's requirements, while also beginning Blackwell GPU fabrication at its Arizona facility to diversify geographic production.
Nvidia is testing HBM4 memory samples from SK Hynix, Micron, and Samsung to avoid supply shortages, with SK Hynix becoming the first company to start delivering HBM4 samples and once again outstripping competitors in advanced memory technology.
How Much Are Hyperscalers Spending on AI Infrastructure
Hyperscalers, including Microsoft, Amazon, Alphabet, and Meta, are projected to spend $602 billion in 2026, up 36 percent year over year, with approximately 75 percent dedicated to AI infrastructure, according to analyst estimates.
This represents an unprecedented capital expenditure surge, with each of the four major hyperscalers expected to exceed $100 billion in annual capex as they race to build the computational capacity required for training and deploying increasingly sophisticated AI models.
Microsoft indicated that fiscal 2026 growth rates would exceed fiscal 2025 levels, when the company spent $88.2 billion, representing 58 percent year-over-year growth.
Amazon CFO Brian Olsavsky stated during recent earnings calls that the company will continue making significant investments, particularly in AI, noting this represents a tremendous opportunity with potential for substantial returns on invested capital over the long run.
Meta signaled that capital expenditures would be notably larger in 2026 than the $72 billion expected for 2025, with CEO Mark Zuckerberg indicating that existing advertising business and platforms operate in a compute-starved state because resources are being allocated toward AI research rather than bolstering current operations.
The scale and urgency of these buildouts underscore why Nvidia's guidance Wednesday carries such weight for technology markets, as any indication of demand softening or delays could force hyperscalers to reconsider the pace and magnitude of planned infrastructure investments that currently drive semiconductor industry growth.
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