NVIDIA Earnings to Test AI Rally's Resilience Amid Valuation Skepticism

NVIDIA (NVDA) shares rose 1.1% in pre-market trading on November 19, 2025, as investors braced for the chipmaker's third-quarter earnings report-a critical event poised to test the resilience of the AI-driven market rally. The stock, which closed at $190.17 on Friday, faced heightened scrutiny amid growing skepticism about AI valuations and recent high-profile investor exits, including SoftBank's $5.8 billion divestment and Michael Burry's short positions. Analysts forecast revenue of $54.9 billion, up 57% year-over-year, with adjusted earnings per share (EPS) expected at $1.26 according to Seeking Alpha, though market participants warned that even a slight deviation from expectations could trigger volatility as noted by Investing.com.

The earnings report, set for after-market release, has become a barometer for the broader tech sector. NVIDIA's performance is closely tied to the health of the AI infrastructure spending wave, with CEO Jensen Huang previously citing $500 billion in cumulative revenue visibility through 2026 from its Blackwell and Rubin chips.

However, concerns linger about overvaluation, with the S&P 500 underperforming and NVIDIA accounting for 7.6% of the index's weight. Bank of America analysts revised their 2026/2027/2028 non-GAAP EPS estimates upward, while Morgan Stanley raised Q3 revenue forecasts to $55 billion, citing robust demand for Blackwell as reported by Blockonomi.

The market's focus extends beyond NVIDIA. The week also features the Federal Reserve's meeting minutes and delayed economic data, including the September jobs report, which could influence investor sentiment ahead of potential rate cuts in December. Meanwhile, retail giants like Walmart and Home Depot are set to report earnings, potentially shifting capital from tech to other sectors.

Historically, NVIDIA's earnings have driven sharp price swings, with ±6–10% movements common in the days following results. Recent volatility has been exacerbated by geopolitical tensions, such as China's suspension of Japanese seafood imports, and internal pressures, including China's halted H20 chip purchases. Despite these risks, hyperscaler capital expenditures remain strong, with Meta, Microsoft, and Amazon expanding data center capacity-a trend directly benefiting NVIDIA's AI hardware.

Analysts remain divided on post-earnings outcomes. A beat could reinforce confidence in AI's long-term growth, while a miss might accelerate skepticism about overvaluation. Morgan Stanley's Joseph Moore highlighted "material acceleration" in cloud spending, projecting $142 billion in 2026 sector capex as reported by Blockonomi, while Goldman's John Waldron warned of potential further market declines as noted by Bloomberg.

As the stock trades near $183.68 according to Investing.com, institutional accumulation in the $175–$185 range suggests quiet conviction as reported by Investing.com, though retail investors face a high-stakes gamble. With the AI rally hanging in the balance, NVIDIA's earnings could redefine market dynamics-not just for the chipmaker, but for the entire tech sector.