Nvidia (NASDAQ:NVDA) is heading into Wednesday's earnings with investors bracing for fireworks. Wall Street estimates for third-quarter revenue are split by nearly $15 billion the widest divergence in at least a decade underscoring just how uncertain the China picture has become. After President Donald Trump temporarily halted Nvidia's chip sales to China in April and then reversed the decision earlier this month under a deal giving the U.S. government 15% of proceeds, Beijing has reportedly begun urging local firms to avoid Nvidia's H20 processors altogether. That combination of shifting U.S. policy and cooling Chinese demand has made the outlook harder to pin down, leaving investors anxious for clarity from management.
Analysts remain divided on whether Nvidia will include China-based revenue in its forward guidance. Susquehanna's Christopher Rolland has excluded H20 chip sales from his model, while UBS's Timothy Arcuri suggests including them could add as much as $3 billion to forecasts. Consensus expectations for the second quarter call for $46.2 billion in revenue and adjusted earnings per share of $1.01, both up roughly 50% from a year earlier, with third-quarter estimates hovering around $53.5 billion in revenue and $1.21 in EPS. Options traders are pricing in about a 6% swing in either direction after the report, reflecting Nvidia's weight in the broader market with its $4.4 trillion market cap and 8.1% S&P 500 Index representation. For many, the key question is whether strong AI-driven demand elsewhere can offset near-term uncertainty in China.
CEO Jensen Huang's commentary will be closely watched for updates on the upcoming B30 chip, which could eventually replace the H20 in China. Demand for Nvidia's Blackwell architecture remains intense globally, giving the company potential levers to outperform expectations even without heavy reliance on Chinese sales. Meanwhile, Chinese AI chip rival Cambricon Technologies reported a record first-half profit on surging domestic demand, boosted by Beijing's push for homegrown alternatives in a post-DeepSeek boom. With Nvidia's stock less than 1% below record highs and up 35% since its May earnings, Wednesday's results could shape investor sentiment on whether China remains a manageable headwind or a developing turning point.