Major stock indexes, including the S&P 500, Dow, and NASDAQ 100, ticked higher as the Nvidia Q4 earnings report is due today, 25th February. The AI leader’s performance will likely impact major tech players such as Google, Microsoft, and Meta. The report will also trigger movement in the global AI data centre arena.
NVIDIA’s share price rose 0.68% yesterday and closed at $192.85. The price continued to climb in the after-market and reached up to $193.74, signalling market confidence in the AI leader. Wall Street estimates a revenue of $65.8B and a net income of $37.4B, which many analysts believe Nvidia will beat. Although the fear of “AI bubble breaking” has dissipated, the earnings report of the “most important AI company” will have high narrative leverage about the future of AI.
How Optimistic is the Market?
NVIDIA is the most important tech company according to the Nasdaq100 index, as it tops the list with a weightage of 13.94%. Giants including Apple, Microsoft, Amazon, and Google lag behind it, emphasising its larger market impact on the entire tech sector.
The AI industry is going through a new wave of excitement as data centres continue to ramp up to meet the AI demand and companies like Anthropic launch agentic AI models with the potential to disrupt several industries. As the fear of AI-replacement rumbles in the IT service sector, AI companies are skyrocketing as their potential revenue margins look promising.
As the “AI bubble” fear eases and data centre expansion is at an all-time high, the market is clearly betting on AI hardware. Korean firms like Samsung and SK Hynix that supply around 80% of HBM (High Bandwidth Memory) are continuing their aggressive rallies as the demand for memory chips far exceeds production capacity.
The Nasdaq 100 climbed 268 points yesterday; the Dow Jones Industrial Average Index (DJIA) climbed 370 points, indicating overall investor confidence in the U.S. tech sector. The S&P 500 also climbed 52 points, signalling that the tech rally is permeating the broader market.
NVIDIA’s Grip on the AI Chip Market
NVIDIA’s advanced GPUs are now traded at a premium valuation as competitors like AMD and Intel are squeezed to single-digit market shares. Moreover, its most advanced Blackwell chips, including the GB series, are setting new golden standards for AI data centres. The GB200 chips are sold out through mid-2026, with a multi-million-unit backlog.
Most hyperscalers like OpenAI, Amazon, Meta, Google, and Microsoft run and train their models using Nvidia’s GPUs. Most of the world’s largest data centres are heavily dependent on Nvidia’s hardware and are likely to continue to do so.
Analyst Take on Nvidia
Harlan Sur from J.P.Morgan projects a 29.63% upside for Nvidia with a target price of $250, whereas Vivek Arya from Bank of America Securities estimates the price to go up to $275, an upside of 42.60%. The Wall Street consensus ( calculated based on 34 analysts’ ratings from the past 3 months) is 39.26% upside with a target price of $268.57.
NVIDIA’s central role in the AI industry and the explosion of AI demand at the consumer and enterprise levels have put it in a premium position, which helped it successfully refute overvaluation concerns. The high leverage from the increasing demand and the absence of competitors (existing competitors are still in the scaling phase) is likely to drive its share price beyond projections.
