February 24, 2025

In the upcoming week, the artificial intelligence (AI) sector is poised for significant activity, primarily driven by key earnings reports and recent market developments.

Nvidia's Earnings Report

Nvidia Corporation, a leading player in AI hardware and software, is scheduled to release its fourth-quarter earnings this week. Analysts anticipate a 72% increase in sales to $38.1 billion for the January quarter, with net profits expected to rise by 5% to $21 billion. This performance is under scrutiny due to recent competition from Chinese AI startup DeepSeek, which introduced a free open-source AI assistant claiming to operate with fewer Nvidia chips. Despite this, analysts remain optimistic about Nvidia's growth, citing continuous technological advancements and robust AI investments from major companies like Microsoft, Amazon, and Alphabet. However, potential challenges include strained U.S.-China relations, as China accounts for 10-15% of Nvidia's shipments. Insights into the demand for Nvidia's new Blackwell chip will also be crucial, given its complexity and potential impact on profit margins.

The Times

Market Implications

Nvidia's earnings are considered a critical indicator for the AI sector. The company's recent stock volatility, including a 17% drop due to DeepSeek's emergence, has heightened investor attention. The forthcoming earnings report is expected to provide clarity on Nvidia's position in the evolving AI landscape and could influence investor sentiment across the tech industry.

Reuters

Other Notable Earnings

Several other companies with AI interests are also reporting earnings this week:

• Salesforce.com: As a prominent provider of AI-driven customer relationship management solutions, Salesforce's performance will offer insights into the enterprise AI software market.

• Snowflake: Specializing in cloud-based data warehousing with AI capabilities, Snowflake's results will shed light on data management trends in AI applications.

• C3.ai: Expected to report earnings on February 26, 2025, after market close, C3.ai's performance will be closely watched, especially after recent stock fluctuations influenced by broader AI market dynamics.

  NASDAQ

Investor Considerations

Given the current volatility in AI stocks, investors are advised to monitor these earnings reports closely. The outcomes will not only reflect individual company health but also provide broader insights into the AI sector's trajectory amidst emerging competition and technological advancements.