New York, May 12, 2026, 10:06 (EDT)
- Nvidia extended gains after hitting a record, as investors piled into AI hardware stocks. The setup heading into May 20 earnings looks strong.
- With Jensen Huang absent from Trump’s Beijing group, China risk lingered, though traders zeroed in on hyperscaler spending rather than short-term export news.
- Bulls argue Blackwell and Rubin demand keeps outpacing available supply. Bears point to funding pressure, power bottlenecks, export rules, and a stock price that doesn’t forgive missteps.
Nvidia was last seen trading close to $222, up roughly 1.2%. It opened at $218.46 and touched a low of $216.33. Monday’s close came in at a record $219.44, marking four consecutive advances for the chipmaker. Its price-to-earnings ratio sat near 54, meaning investors are paying that much for each dollar of profit.
Investors are once again viewing Nvidia as the purest play on AI infrastructure demand, helping to push the chart higher. Bernstein’s Stacy Rasgon told MarketWatch that big capital spending from hyperscalers—those massive cloud and platform players—shows appetite for Nvidia chips hasn’t let up. He also flagged the stock’s earlier lag versus certain AI supply chain names, calling that a “divergence.” MarketWatch
This suddenly matters, with Nvidia set to report next week. Traders are lining up for another quarter where chip demand, networking demand, and getting enough supply—those take priority over another standard earnings beat. Forget just chasing momentum. What’s on the table is whether Big Tech’s AI spending still turns into Nvidia revenue quickly enough to support that $5 trillion-plus valuation.
The China news swung the opposite direction. According to Reuters, Jensen Huang won’t be part of President Donald Trump’s trip there, but Apple’s Tim Cook, Tesla’s Elon Musk, Qualcomm’s Cristiano Amon and other execs are on the list. The risk: Nvidia is after Chinese AI business, but the White House is steering the visit toward agriculture, aviation, and trade events. Commerce Secretary Howard Lutnick noted that the H200 chips approved for China still haven’t found buyers.
Investors barely blinked. Nvidia had already built that risk into its guidance. For the first quarter of fiscal 2027, the company projected revenue at $78 billion, give or take 2%, and made it clear: no Data Center compute revenue from China is assumed. CEO Jensen Huang widened the lens, saying customers are “racing to invest” in AI compute. Nvidia expects gross margins to hover around 75% — that’s the slice of sales left after direct production costs. NVIDIA Newsroom
Still an aggressive tone on the call, just not reckless. CFO Colette Kress pointed to Nvidia’s $11 billion sequential jump in data-center revenue, highlighting increasing demand for Blackwell as inference deployments pick up—recall, inference refers to running AI models once they’re trained. She also flagged expectations for further sequential revenue growth through calendar 2026, with supply agreements in place that extend into 2027.
Bulls point to one thing: money for AI is still rushing toward Nvidia’s choke points. Reuters says four of the biggest tech names are lined up to pour around $600 billion into AI this year. That’s a capex figure—long-term hardware dollars—big enough to keep GPUs, networking equipment, and data center systems tight, even if profits from software lag behind.
Bears are making their move. Shares of IREN dropped after the company rolled out a $2 billion convertible debt deal—debt that could flip into equity—hot on the heels of its AI infrastructure agreement tied to Nvidia. “Super volatile,” is how Paul Meeks at Freedom Capital Markets described IREN, pointing to its heavy spending needs. Morningstar’s Luke Yang flagged the prospect of the company needing “tens of billions more funding.” So, while AI demand keeps rising, the cost to play keeps climbing, too. MarketWatch
It’s a mixed picture on the competitive front. Early trading saw AMD, Broadcom, and TSMC’s U.S.-listed shares all in the red, with chip ETFs SOXX and SMH also slipping—Nvidia’s gains didn’t ride a general semiconductor wave. Alphabet still looms as a significant competitive risk. Google Cloud keeps expanding rapidly, and its in-house AI chips have landed customers like Anthropic. That gives the largest buyers fresh leverage to dial back their dependence on Nvidia down the road.
Prediction markets are offering some sharp signals. On Polymarket, the odds Trump lands in China on May 13 were trading at roughly 97%, suggesting traders see little chance of any last-minute change in plans. Over at Kalshi, a 97% probability the Fed keeps rates steady in June points to scant faith in imminent rate cuts—bad news if you’re hoping for relief for high-valuation growth names.
Right now, the market cares more about Trump and Xi keeping the AI supply chain intact than hashing out any big trade pact. According to Reuters, fund managers have their eyes on AI supply, chip export curbs, and China’s tech ambitions—tariffs aren’t the headline risk. Which helps explain why Huang’s no-show didn’t hit harder.
The logic behind the rally isn’t complicated. Nvidia shares are climbing as investors look ahead to the upcoming earnings—they’re treating it as a barometer for demand rather than just another quarterly number. The story can keep playing out if management demonstrates they’ve got Blackwell chips flowing, gives clarity on Rubin, and keeps margins close to that mid-70% mark. Things tighten up if AI customers lean harder on borrowing, if power supply bites, or if access to China shifts from bonus to significant political headache.
