Will Nvidia Soar After May 28? History Offers a Decidedly Clear Answer.

Core Viewpoint - Nvidia has experienced significant stock growth due to its dominance in the AI chip market, with shares increasing over 800% from 2023 to 2024, but has faced challenges in 2024 due to economic concerns and tariffs [1][2]. Company Performance - Nvidia's GPUs have seen increased demand as companies invest heavily in AI, with the AI market projected to exceed $2 trillion in the coming decade [5]. - The company has reported multiple quarters of double- and triple-digit revenue growth, achieving record revenue and net income, with gross margins exceeding 70% [6]. - Nvidia has a history of beating analysts' earnings estimates, with its recent Blackwell architecture generating $11 billion in revenue during its first quarter of commercialization [9]. Market Environment - Concerns over President Trump's import tariffs have impacted Nvidia's stock performance, but recent trade deals have improved optimism regarding tariff levels [7][8]. - Despite recent declines in stock performance, historical data suggests Nvidia typically experiences double-digit gains following earnings reports, with past gains ranging from 50% to 90% [11]. Future Outlook - The upcoming earnings report on May 28 is anticipated to influence Nvidia's stock direction, with historical trends indicating potential for significant gains post-report [3][12]. - While recent declines were linked to tariff uncertainties, the resolution of these concerns may lead to a rebound in stock performance [12][14]. - Nvidia's strong competitive position in a high-growth market suggests long-term success, regardless of short-term fluctuations [14].