Nvidia's Q2 Earnings: Expectations Soar, Uncertainty Looms Amid Robotics Boom

Nvidia is set to report earnings on Aug. 27, with analysts Dan Ives and Gene Munster predicting a strong performance. Ives believes Nvidia will demonstrate its dominant role in powering the AI revolution, while Munster thinks robotics could become a new growth engine. However, some analysts warn that Nvidia's outlook for the next quarter may fall short of expectations due to concerns around U.S. export licenses and Chinese government pressure on domestic chip adoption.

NVIDIA Corporation (NVDA) is poised to release its second-quarter fiscal 2026 earnings on August 27, with analysts anticipating robust financial performance. The company has been a key player in the AI revolution, with its chips powering various AI applications across industries [1].

Analysts Dan Ives and Gene Munster predict a strong performance for NVIDIA. Ives believes the company will demonstrate its dominant role in powering AI, while Munster sees robotics as a potential new growth engine [2]. However, some analysts warn that NVIDIA's outlook for the next quarter may fall short of expectations due to concerns around U.S. export licenses and Chinese government pressure on domestic chip adoption [3].

NVIDIA's strong performance is driven by the continued strength in its Data Center business, which benefits from the increasing adoption of cloud-based solutions and the growing hybrid working trend. The company's AI chips, including the A100, H100, B100, B200, and GB200, are the top choices for building and running powerful AI applications, positioning NVIDIA as a leader in the generative AI market [1].

However, NVIDIA faces potential headwinds from China export curbs, which could result in an $8 billion hit. The chipmaker has reportedly told suppliers to suspend production of its H20 chip due to security concerns raised by Beijing [3]. This move is expected to impact the company's revenue, particularly in its data center business, which has been a primary growth engine.

KeyBanc Capital Markets predicts that NVIDIA’s Q3 guidance could be lower than the consensus due to uncertainties in China. The brokerage noted that NVIDIA’s outlook might exclude direct revenue from China given pending license approvals and uncertainty on timing [3]. If sales from China were included, it could potentially boost revenues by an additional $2-3 billion.

Despite the challenges, NVIDIA has been navigating the geopolitical maze, with its GPUs at the center of the Silicon Silk Road, trading in silicon and threading its GPUs through the geopolitical landscape. The upcoming Blackwell Ultra (B300), scheduled to start shipping in the October quarter, could account for half of total Blackwell deliveries, which could mitigate some of the revenue losses [3].

In conclusion, while NVIDIA faces potential challenges from China export curbs, the company's strong product portfolio and leadership in AI make it a compelling investment opportunity. Analysts' overwhelmingly bullish stance suggests that investors should closely monitor NVIDIA's earnings report and the company's response to the China export curbs.

References:
[1] https://www.nasdaq.com/articles/ai-demand-and-datacenter-momentum-lift-nvidias-q2-earnings
[2] https://www.ainvest.com/news/nvidia-china-sales-limited-boost-2508/
[3] https://www.benzinga.com/markets/tech/25/08/47253428/nvidias-china-trouble-could-spoil-q3-outlook-analyst-warns-might-exclude-direct-revenue-from