TLDR
- Nvidia reports Q3 FY26 earnings Wednesday with analysts expecting $54.83 billion revenue, up 56.3% year-over-year
- Bank of America sets $275 price target, calling valuation attractive at 27x 2026 earnings estimates
- Major investors Michael Burry and Peter Thiel recently exited positions, fueling AI bubble concerns
- Company secured $500 billion in Blackwell and Rubin orders, beating forecasts by 10-15%
- 37 of 39 analysts rate stock a Buy with average target implying 27% upside
Nvidia faces a defining moment Wednesday when it reports Q3 fiscal 2026 results. The outcome will likely set the tone for AI-related stocks through year-end.
Wall Street forecasts revenue of $54.83 billion, representing 56.3% growth from last year. Earnings per share should hit $1.25, up 54.3% year-over-year. Those numbers would extend an impressive run that saw Q2 revenue jump 56% and earnings climb 61%.
Bank of America analyst Vivek Arya maintains his Buy rating with a $275 target. He calls the current valuation “compelling” at 27 times 2026 earnings and 21 times 2027 estimates. Arya recently shifted his price target methodology to use a 30x multiple on 2027 earnings rather than 44x on 2026 numbers.
The analyst expects management to address concerns about AI infrastructure spending and supply constraints. He views the recent stock pullback after the company’s GTC event as a positive signal heading into the report.
Some Big Names Are Backing Away
Not everyone buys the bullish case. Michael Burry shorted $1.2 billion in Nvidia and Palantir stock last quarter. Peter Thiel’s fund sold its entire 537,742-share position between July and September, representing 40% of the portfolio.
These exits reflect growing unease about AI valuations. Critics argue companies are spending billions on infrastructure without clear paths to returns. The “AI bubble” label has moved from speculation to how major investors are positioning their portfolios.
Nvidia announced $500 billion in orders for Blackwell and Rubin chips covering 2025 and 2026. The figure came in 10% to 15% above expectations. The company remains the only merchant chip supplier with proven execution at scale across multiple AI cluster generations.
Competition is increasing though. OpenAI added Broadcom and AMD to its supplier roster. Google’s Tensor Processing Units continue gaining adoption. These developments raise questions about Nvidia’s pricing power and market share going forward.
Key Metrics to Watch
Investors will focus on several data points beyond headline numbers. Guidance matters most since it signals management’s confidence in near-term demand. Any hint of slowing momentum could trigger selling across chip stocks.
Margin performance will get scrutiny too. If costs are rising faster than revenue, it challenges the profitability narrative. Commentary on customer concentration is important since relying on a few hyperscalers creates risk.
Management’s remarks about supply bottlenecks and infrastructure constraints will be parsed carefully. Some analysts worry spending is outpacing actual revenue generation across the AI ecosystem.
The analyst community remains overwhelmingly positive. Of 39 analysts covering the stock, 37 rate it Buy, one says Hold, and one recommends Sell. The average price target of $242 suggests 27% upside. Shares have gained 42% year-to-date.
Evercore analyst Mark Lipacis expects a beat-and-raise quarter. That view is widely shared on Wall Street. But elevated expectations mean even solid results could disappoint if they fall short of perfection.
Wednesday’s report will move more than just Nvidia shares. The results will either validate the massive AI buildout or raise uncomfortable questions about timing and returns. Either way, the market will react strongly.
The stock trades at premium multiples that assume flawless execution. Given the billions invested across the AI sector, this earnings report carries weight far beyond one company’s quarterly performance.