NVIDIA faces a major performance test next week, and its stock price may fluctuate by 7% after the results

According to the Zhitong Finance APP, options traders tracked by Bloomberg predict that the stock price of artificial intelligence chip manufacturer NVIDIA (NVDA.US) may fluctuate by as much as 7.4% the day after it announces its quarterly earnings on May 28. This figure is lower than the average volatility of 11.3% seen in the stock price of NVIDIA in the eight quarters following its earnings announcements. NVIDIA's stock price fell by 8.5% in February, despite the company reporting fourth-quarter earnings that exceeded market expectations, as its first-quarter gross margin guidance fell short of market expectations. The day after the earnings report, the stock price initially rose by 2.8% but later dropped by 8.6%, resulting in a volatility range of 11.4%. NVIDIA stock price post-earnings volatility range Despite the significant average volatility of NVIDIA's stock price in the eight quarters following earnings releases, investors holding NVIDIA shares have seen substantial returns. According to Yahoo Finance analyst Jared Blikre, over the past 10 years, if NVIDIA shareholders bought shares before earnings announcements and held them for 12 months, the average return was nearly 120%. Historical data shows that buying NVIDIA stock before earnings yields substantial returns Before announcing its earnings on May 28, NVIDIA's stock price experienced a tumultuous year influenced by the development of artificial intelligence in China and the changing trade policies of the Trump administration. Concerns about the massive AI infrastructure spending by large tech companies were raised due to the low-cost AI model launched by Chinese startup DeepSeek, along with worries about a slowdown in spending. At the beginning of 2025, NVIDIA's stock price struggled. There are signs that one of NVIDIA's largest customers, Microsoft, may slow its investments in AI data centers, further exacerbating concerns. U.S. government export controls on chips and global tariffs have also severely impacted NVIDIA's stock. However, factors such as the temporary trade truce between the U.S. and China, NVIDIA's overseas business prospects (specifically expansion into Saudi Arabia), and the Trump administration's repeal of restrictive chip trade policies from the Biden era have boosted the stock price ahead of NVIDIA's earnings announcement. Wall Street analysts expect NVIDIA's revenue and earnings for the first quarter of fiscal year 2026, ending in April, to grow significantly, although the growth rate may continue to slow. Analysts predict that NVIDIA's first-quarter revenue will increase by over 66% to $43 billion, and adjusted earnings per share will jump 44% to $0.88. In comparison, in the first quarter of last year, NVIDIA's revenue grew by 262%, and earnings per share increased by 461% Investors will closely monitor the impact of Trump's restrictions on NVIDIA's chip sales to China in next week's earnings report. NVIDIA CEO Jensen Huang stated that the policy has resulted in a loss of $15 billion in sales for the company