Nvidia Faces Fiscal Q3 Test as Stock Lags Chip Index by Nearly 50 Points
Updated
Updated · The Motley Fool · Aug 25
Nvidia Faces Fiscal Q3 Test as Stock Lags Chip Index by Nearly 50 Points
3 articles · Updated · The Motley Fool · Aug 25
Summary
Later this week, Nvidia reports fiscal third-quarter earnings with investors focused less on headline growth than on whether margins and hyperscaler demand can hold up.
Roughly 12% year-to-date stock gains have badly trailed the PHLX Semiconductor Index's 60%-plus rise, reflecting doubts that Nvidia can sustain growth after trailing 12-month revenue topped $250 billion.
About 25 times forward earnings, Nvidia looks cheaper than many AI peers despite a 74% gross margin, 85% year-over-year revenue growth last quarter and a reported $1 trillion order book across 2026 and 2027.
AMD and custom accelerators from hyperscalers are intensifying competition, raising pressure on Nvidia's pricing power even as the company remains the dominant force in AI infrastructure.