NEW YORK, May 18, 2026, 15:03 (EDT)
- Nvidia dropped 2.8% in afternoon trading. AMD and Broadcom were also down.
- The chipmaker is set to report its fiscal first-quarter results Wednesday after markets close.
- Investors are tracking if demand for AI chips can balance out the impact from higher rates, China restrictions and high expectations.
Nvidia NVDA slid 2.8% to $219.05 on Monday, pulling chip stocks lower as traders lightened up on positions ahead of its fiscal first-quarter report this week. Shares earlier hit $230.62. Nvidia’s market cap sits at about $5.36 trillion.
Nvidia isn’t just another chip stock anymore. Now the top company by market value, its results are a test for the whole artificial intelligence trade — the buying of stocks linked to AI, or software that does tasks people used to do.
Wall Street stayed on the back foot. The Nasdaq pulled U.S. indexes down as investors took profits and Treasury yields climbed. The Philadelphia Semiconductor Index dropped 3.8% as chip shares slid. “Some profit taking” followed the quick run-up, said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder, noting investors were responding to softness in the market and joining in. Reuters
Nvidia will release earnings Wednesday, with a call set for 2 p.m. Pacific, 5 p.m. Eastern. Written comments from CFO Colette Kress are expected soon after the results drop, ahead of the call.
Big numbers are on the table. S&P Global, using Visible Alpha consensus, has Nvidia’s projected quarterly revenue at $78.5 billion, with data center revenue at $72.8 billion. Data centers, which are the main buyers of Nvidia’s GPUs—chips that handle AI work—are in focus.
Analyst target hikes keep coming before the report. Morgan Stanley’s Joseph Moore is now at $285 on Nvidia, calling it a “top pick” among semis. KeyBanc’s John Vinh took his target up to $300, pointing to better Blackwell chip shipments. The Motley Fool
The drop didn’t stop at Nvidia. Advanced Micro Devices slipped 3.0% to $411.48, and Broadcom shed 2.2% to $416.03, leaving the AI hardware sector under pressure across the board.
“Good” might not cut it. Nvidia’s first-quarter forecast had no data center compute sales expected from China, and if hyperscalers start pulling back on AI orders, the stock could still take a hit, even if revenue tops forecasts. NVIDIA Newsroom
Margins remain a key metric. Nvidia’s bull thesis has long leaned on gross margin, the chunk of sales left after production costs, since the company moves high-demand chips at steep prices. Nvidia is looking for a GAAP gross margin of 74.9% for the quarter, give or take 50 basis points—a single basis point is one one-hundredth of a percent.
Nvidia stock is moving more on the setup than actual results right now. Demand for Blackwell and early Rubin systems could still top what Wall Street has in its models. But if Nvidia delivers just an in-line forecast, the market may start to question if the AI trade is outpacing the company’s earnings.
