Nvidia Earnings Week: Will AI or the Consumer Carry Stocks?

Nvidia (Nasdaq: NVDA) reports fiscal 2027 third-quarter earnings after the closing bell on Tuesday, November 17, with numbers due around 4:20 p.m. ET and the earnings call at 5 p.m. ET. It is the first report since Jensen Huang stepped down as CEO. The company said CFO Colette Kress will post written commentary ahead of the call, and according to Kiplinger, Kress, now also interim CEO, is set to host it. The same week, The Home Depot (NYSE: HD), Target (NYSE: TGT) and Walmart (Nasdaq: WMT) report in turn. Next week, Wall Street tests two things at once: the AI profit story and the staying power of the U.S. consumer.

Stocks come into the week with a gain behind them. Based on Yahoo Finance closing prices, the S&P 500 rose 2.5% and the Nasdaq Composite 2.3% over November 9-13, the first weekly advance in five weeks, since the week ended October 9 (Gist 7 calculation). Friday itself was rough: producer-price data and a chip selloff pushed the Nasdaq down 0.9% on the day to 25,136.27. The 10-year Treasury yield ended at 5.15%, up 0.29 percentage point on the week, per the U.S. Treasury. Nvidia shares fell 12% over the week to about $163 (Investopedia, via Yahoo Finance).

Nvidia earnings: what is Wall Street expecting?

Analyst estimates for Nvidia's third-quarter revenue run from $108.8 billion to $109.4 billion, slightly above the $108 billion (plus or minus 2%) the company guided to in August. Kiplinger's consensus calls for revenue of $108.8 billion and earnings of $2.47 per share, roughly 90% higher than a year earlier. Visible Alpha's survey, as cited by Investopedia, puts revenue at $109.4 billion and net income at about $60.9 billion.

Company snapshot

Sources: Nvidia Q2 results, Kiplinger (updated Nov. 13), Investopedia

The guidance for the next quarter may matter more than the headline numbers. Options pricing implies Nvidia stock could move about 8% in either direction by the end of next week. The implied move is the size of the price swing the market expects, backed out of option prices. Per Investopedia's math, that leaves room for a move above $176 or below $150.

We covered the circumstances of Huang's exit in Jensen Huang's resignation and Nvidia's plunge. This report is about what comes after. According to Kiplinger, Cullen Rogers, chief investment officer at Wedbush Fund Advisers, framed the call as the first read on whether Nvidia can execute without its founder. Whether the company held the 74.0% gross margin it guided to, and how much revenue it forecasts for the next quarter, will likely decide that read.

Walmart and Home Depot earnings: how much does the consumer have left?

The U.S. consumer is still spending, but at a slower pace, and Zacks says elevated fuel costs are squeezing both shoppers and retailers. Zacks' consensus has Walmart's U.S. comparable sales excluding fuel up 2.89%, a bit better than the actual 2.6% in the second quarter but below the 4.5% of a year earlier. Comparable sales measure growth at stores open more than a year, so they strip out the effect of new locations.

Next week's U.S. retail earnings start with Home Depot on Tuesday and end with Walmart on Thursday. For Walmart's third quarter, Kiplinger's consensus is EPS of $0.63 on revenue of $187.2 billion, while Zacks has slightly different figures: EPS of $0.64 on revenue of $186.5 billion.

Company snapshot

Sources: Kiplinger earnings calendar (updated Nov. 13; Lowe's and TJX dates tentative), Zacks (via Yahoo Finance)

The key Walmart question is whether it lifts its full-year EPS guidance of $2.80 to $2.87, issued with its second-quarter report (as cited by Kiplinger), toward the top of the range. A couple of side reports round out the consumer picture. On Kiplinger's calendar, The Walt Disney Company (NYSE: DIS) reports before the open on the 17th, a read on leisure and entertainment spending, and Palo Alto Networks (Nasdaq: PANW) reports after the close on the 18th, a read on corporate tech budgets.

Next week on Wall Street: will AI or the consumer set the direction?

Nvidia carries more weight for the index. According to Zacks, the 454 S&P 500 companies that had reported through November 13 grew third-quarter earnings 24.9% from a year earlier. Micron Technology (Nasdaq: MU) and Alphabet (Nasdaq: GOOGL) account for a big share of that growth; excluding the two, it drops to 21.7%. Zacks counts Nvidia, which has yet to report, as the third company driving the index's annual earnings growth. With the 10-year yield above 5%, the case for today's valuations rests heavily on profit growth at a handful of AI companies.

Retail results act as a check on whether those profit hopes are drifting away from the real economy. Zacks noted that Walmart has drawn buying in recent weeks as a defensive name while the AI trade lost some luster. On November 13, as the Nasdaq slipped 0.91%, Walmart rose 1.5% to close at $128.09 (Yahoo Finance). Still, at 40.1 times forward 12-month earnings, Walmart is not cheap.

Here is how Gist 7 reads the possible combinations:

• Nvidia strong, retail solid: the Nasdaq, which fell 0.9% on November 13 on PPI and a chip selloff, gets earnings support to offset higher rates.
• Nvidia strong, retail weak: the index may hold up, but money could crowd even further into chips.
• Nvidia disappoints, retail solid: the rotation from tech into consumer staples and defensive names could continue.
• Both disappoint: the weight of 5% yields could show up directly in stock valuations.

There is one more variable. On Wednesday, November 18, at 2 p.m. ET, the Fed releases the minutes of its October 27-28 Federal Open Market Committee (FOMC) meeting. Minutes are the record of the policy discussion, published three weeks after each decision. If they show concrete talk of further hikes, rates could weigh on stocks again the day after Nvidia reports.

Market impact map

The table maps next week's events to the assets they are likely to touch. Direction depends on the outcome.

Little direct impact: 10-year Treasury (already elevated at 5.15% on Nov. 13), dollar index, won/dollar exchange rate, gold, oil (WTI), bitcoin

• Investors in U.S. stocks from Asia: Nvidia's numbers land before dawn in Seoul and Tokyo, so after-hours prices and Asian chip stocks may move together that morning.
• Grocery bills: Zacks says high fuel costs also lift retailers' freight and other expenses. How U.S. retailers talk about pricing will feed back into inflation and rate expectations.

Market reactions can vary with other factors, and this table is not a basis for investment decisions.

What to watch next