Nvidia earnings face AI boom test amid intensifying market competition

Nvidia will report its highly anticipated fourth-quarter earnings on February 25, 2026, with analysts expecting record revenue driven by soaring AI demand and hyperscaler spending.

As Nvidia heads into quarterly earnings, AI investors are seeking evidence that the chipmaker's profits are growing apace on the back of a $630 billion capital spending budget from Big Tech. 

But signs of risk to Nvidia's long-held dominance are also emerging from hyperscalers' plans to design their own cheaper AI chips.

The results come amid intensifying competition, record short interest, and a U.S.-China technology dispute over its most advanced Blackwell chips. Investors are watching for signs of sustained growth, guidance strength, and clarity on China sales as potential catalysts for the stock.

After powering much of the U.S. stock market rally for the past three years, Nvidia's stock has risen just about 2% so far in 2026.

Nvidia Rivals:

Along with Advanced Micro Devices, which is set to unveil a new flagship AI server later this year, Alphabet's Google has emerged as a top rival with a deal to provide Claude chatbot creator Anthropic with its in-house chips called TPUs.

Google is also in talks to supply Meta—a large Nvidia customer, according to media reports.

To defend its position, Nvidia struck a deal, reportedly worth $20 billion, last year to license chip technology from Groq—a move that analysts say would boost its position in the booming market for inference, the process by which a trained AI model answers questions in real time.

Nvidia last week also agreed to sell millions of chips to Meta, though it did not disclose the value of the deal.

But Nvidia, the biggest winner of the AI boom, has itself stoked doubts about whether the spending is sustainable by drawing out the process of a potential $100 billion investment in OpenAI, one of its biggest customers.

A recent media report said it plans to replace that commitment with a smaller $30 billion investment.

Nvidia is Still No. 1:

Analysts are still expecting demand for Nvidia's pricey chips, which act as the "brains" of servers processing huge AI workloads, to remain robust and garner most of Big Tech's massive spending to expand AI data center capacity this year.

Nvidia's executives also hinted in January that the company would update a $500 billion order backlog figure it first offered in October.

The biggest constraint on Nvidia's growth, though, could be supply chain bottlenecks that limit the speed of AI chip shipments as Nvidia and rivals are vying for space on contract chipmaker TSMC's 3-nanometer assembly lines.

CEO Jensen Huang said last month he hopes China will allow the company to sell its powerful H200 AI chip in the country and that the license is being finalized.

Nvidia is expected to record an adjusted gross margin of 75% in the fourth quarter, an increase of more than one percentage point from the year-ago period.

Record revenue expected on AI surge

Analysts forecast Nvidia will post Q4 revenue of roughly $65.6 to $66.2 billion, up more than 68% year-over-year, with earnings per share rising to around $1.50–$1.53. 

The growth is driven by massive 2026 AI capital spending from hyperscalers like Amazon, Google, Meta, and Microsoft, totaling an estimated $650 billion. 

Nvidia has beaten analyst revenue estimates for 13 straight quarters and EPS estimates for 12 straight quarters, and some analysts expect a moderate beat-and-raise this time as well.