AI MemeLab | All Eyes on NVIDIA's Q1 Earnings

AI leader NVIDIA is set to release its fiscal Q1 2026 earnings after market close on May 28, in what has become the most anticipated earnings report of the moment. As a bellwether for the artificial intelligence sector—particularly amid tariff headwinds—the company's performance could act as a catalyst for the next leg of the U.S. stock rally.

With a staggering $7 trillion in cash on the sidelines, a beat on estimates could trigger a massive influx of capital into equities. However, investors must contend with the risk of multibillion-dollar revenue hits from U.S. export controls to China, with potential write-downs looming large.
Key Forecasts and Risks
Revenue: $43.3 billion (+66% YoY), up from $39.3 billion in the prior quarter.
EPS: $0.93 per share.
China-Related Headwinds: The H20 chip export ban is expected to force a $1 billion revenue write-down in Q1, part of a projected $15 billion annual impact on potential sales. Excluding this hit, growth remains robust amid tight supply conditions.
While NVIDIA is urgently lobbying the U.S. government to ease restrictions and plans to launch the HBM-free L40 chip as a workaround, Morgan Stanley warns of lingering policy uncertainty.
Long-Term Catalysts: Blackwell and AI Demand
Despite short-term disruptions from the H20 sales curbs, the bank highlights improvements in Blackwell supply chains and explosive AI inference demand as key positives. Production bottlenecks for Blackwell racks—critical to NVIDIA's data center business—are easing, with three major ODMs (responsible for ~90% of supply) achieving a monthly output of ~1,500 racks in April, a figure expected to grow throughout the year. The surging demand for AI inference, rather than short-term policy debates, will ultimately determine NVIDIA's long-term valuation.
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