Nvidia Corporation (NVDA) shares are poised to resume trading Tuesday after the Memorial Day holiday, with investors still digesting the chipmaker's latest earnings report. The stock closed Friday at $215.33, down approximately 4.4% from its May 15 close, according to market data. U.S. cash equities were closed Monday for the holiday, giving traders additional time to assess the implications of Nvidia's results against a backdrop of rising oil prices, geopolitical tensions, and shifting bond yields.
Nasdaq 100 futures last traded up 0.86% early Tuesday, while S&P 500 futures gained 0.66%, signaling a positive open for broader markets. Oil prices also edged higher following new U.S. strikes in the Middle East, which dampened hopes for a swift U.S.-Iran peace agreement. These macro factors add another layer of complexity for growth stocks like Nvidia, which are sensitive to higher discount rates.
Record Quarter Fails to Ignite Rally
Nvidia reported fiscal first-quarter revenue of $81.6 billion, an 85% year-over-year surge, with data-center revenue reaching $75.2 billion, up 92%. The company guided for second-quarter revenue of approximately $91 billion, plus or minus 2%, and authorized an additional $80 billion for share buybacks. CEO Jensen Huang described the wave of "AI factories"—data centers packed with GPUs—as the largest infrastructure expansion in history, adding that "agentic AI has arrived."
Despite these blockbuster numbers, the stock declined after the report, reflecting a market that may have already priced in such outperformance. David Wagner, head of equity and portfolio manager at Aptus Capital Advisors, noted that Nvidia "delivered exactly on what people wanted," but cautioned that markets do not always react as expected to strong results.
Analysts Raise Targets, but Caution Grows
Morningstar analyst Brian Colello raised his fair value estimate on Nvidia to $280 from $260, citing "near- and medium-term growth that continues to modestly outpace" his prior expectations. He highlighted robust demand from cloud providers and enterprise customers, and noted that networking revenue nearly tripled year over year to close to $15 billion.
However, some investors are questioning whether expectations have become too elevated. Nvidia's current guidance already excludes any data-center compute sales from China, and tighter export rules, custom processors from major buyers, and more affordable competing accelerators could pose risks. The Philadelphia Semiconductor Index rose 1.3% on Thursday following Nvidia's results, indicating a positive read for the sector, though attention is also turning to rivals Advanced Micro Devices (AMD) and Intel (INTC).
AI Supply Chain in Focus
This week brings additional tests for the AI trade. Dell Technologies (DELL) reports earnings Thursday, with investors focused on AI server sales, while Marvell Technology (MRVL) reports Wednesday, drawing attention to AI custom chips and its recent Nvidia-linked deal. Their results could either reinforce the narrative that AI spending is flowing through the supply chain or highlight that Nvidia is capturing the majority of profits.
With Nvidia's stock stuck in a range despite record earnings, the key question is whether this reflects a temporary pause ahead of a holiday or a more lasting cooling of the AI rally. Tuesday's open may provide an early signal. For now, the issue is not about demand falling—it's about how long the market's patience will hold.
