What to expect from Nvidia’s upcoming 4Q results

What Happened?

Nvidia is set to report its fourth-quarter results on 26 February 2025 (US time), after the market close. 

The earnings announcement is a key event that will be closely monitored by market observers and investors.

As the leading artificial intelligence (AI) enabler over the past three years, Nvidia has enjoyed an impressive share price rally, reflecting strong investor confidence. 

However, new developments in the AI space have raised questions about its dominance.

What are market expectations for Nvidia's earnings?

Based on consensus estimates as of 24 February, analysts are expecting as sharp increase in Nvidia's fourth quarter revenue and earnings per share: 

• Revenue is expected to be USD 38.15 billion, representing a 73% year-over-year increase.

• Earnings per share (EPS) is expected to be USD 0.85, representing a 63% year-on-year increase.

Why Are These Results Critical for Nvidia and Investors?

This will be Nvidia’s first earnings report since DeepSeek’s groundbreaking AI model was unveiled in January 2025. 

DeepSeek’s model has outperformed existing AI models from US tech giants such as OpenAI’s ChatGPT and Google’s Gemini— but with a major twist.

DeepSeek claims it achieved this performance using just 2,048 units of Nvidia’s lower-end H800 GPU, challenging the assumption that new AI models would require more powerful and expensive Nvidia GPUs.

This development raises concerns over Nvidia’s growth trajectory, particularly its ability to continue selling higher-spec GPUs at premium prices. 

Investors will be watching closely for any signs that DeepSeek’s breakthrough could reduce long-term demand for Nvidia’s most advanced chips.

Strong Capital Expenditure Trends by Big Tech

Despite these concerns, Nvidia’s key customers continue to ramp up spending on AI infrastructure.

The four biggest US tech companies—Microsoft, Alphabet (Google), Meta, and Amazon—are expected to increase capital expenditure by 46% in 2025, bringing their total spend to 325 billion dollars.

A significant portion of this investment will be directed toward AI and cloud computing, reinforcing Nvidia’s importance in powering these AI-driven cloud services.

Big Tech’s Cloud Business Driving Growth

The rapid expansion of cloud services further supports the demand for Nvidia’s AI chips:

• Amazon Web Services (AWS) revenue surged 19% year-on-year
• Google Cloud revenue jumped 30% year-on-year

These growth figures suggest that AI investments are translating into real business value, which is a positive sign for Nvidia’s long-term prospects.

Key Areas to Watch in Nvidia’s Earnings Call

Beyond the headline numbers, investors will pay close attention to CEO Jensen Huang’s outlook on:

• Future AI applications, particularly in robotics and AI-driven automation
• The role of AI agents, a key theme he emphasised at CES 2025
• How Nvidia plans to respond to competition from Chinese AI companies and potential shifts in GPU demand

Nvidia’s Share Price: Still Below Pre-Deepseek Levels

While Nvidia’s stock has remained relatively flat year-to-date, it is still 9% below its peak before the Deepseek announcement on 27 January 2025.

This reflects lingering uncertainties over whether new AI models will reduce demand for Nvidia’s high-end GPUs, especially as Nvidia is restricted from selling its most advanced chips to China.

Conclusion: What This Means for Investors

Nvidia’s upcoming earnings report will be a key moment for the AI industry, offering insights into whether its dominance in AI chips remains intact.

Investors should watch for:

• Nvidia’s sales trends for high-end GPUs
• Management’s response to Deepseek’s AI breakthrough
• Future AI demand outlook from major tech players

With AI driving unprecedented growth in cloud and enterprise applications, Nvidia remains a crucial player in this space—but the coming earnings call could provide critical answers on whether its long-term growth story remains as strong as before.

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