Nvidia has led the AI rally for three years, as US growth shares have weakened in 2026. The NASDAQ 100 has fallen by over 3% in the past month and is down year to date.
Forecasts put Nvidia earnings per share at about $1.54, up 70% year on year. Revenue is expected to rise 68% to $66.12 billion.
Options Setup For Earnings Night
Demand for AI chips and data centre servers remains the main driver. UBS estimates direct AI capex of $423 billion in 2025, rising above $570 billion in 2026, with some forecasts as high as $700 billion.
Market conditions include geopolitical tension linked to a possible attack on Iran and efforts to reinstate US tariffs. Since last November, money has moved from AI-linked shares into consumer staples, utilities, and healthcare.
Guidance is a key focus alongside the headline figures. Wall Street estimates Q1 revenue of $71 billion, up $5 billion quarter on quarter, with reactions expected above that level and below $70 billion.
Gross margin is also watched, after a Q3 level of 73.6% and a target in the mid-70% range. Other topics include PC system-on-a-chip work with Intel, China sales, Vera Rubin timing, and an OpenAI commitment cut from $100 billion to $30 billion.
Key Levels And What Sets The Tone
Technical levels cited include support from $164 to $171, resistance near $211, and a longer-term level near $235. Moving averages referenced are the 200-day and 50-day SMAs.
With the NASDAQ 100 already down over 3% this past month, we are looking at a nervous market heading into Nvidia’s earnings tonight, February 25, 2026. The entire AI narrative hinges on this single report, creating a high-volatility environment perfect for derivative plays. A significant move in either direction is highly probable.
The headline numbers are impressive, but our focus should be on forward guidance for the first quarter. Wall Street needs to see a revenue projection above $71 billion to restart the bull run, while anything below $70 billion could trigger a sharp sell-off. This specific range provides clear targets for setting strike prices on options contracts.
This situation feels very similar to what we saw in 2023, when Nvidia’s blowout earnings report in May sent the stock soaring over 24% in a single day, pulling the entire market with it. Historical data shows these reports can cause massive price swings, which is why implied volatility is so high right now. We must be prepared for a move of similar magnitude tonight.
From a technical standpoint, the key resistance level to watch is $211. Call options with strike prices above this level could be profitable if guidance is strong, targeting the next trendline resistance near $235. Conversely, the $164 to $171 range, now supported by the 200-day moving average, is the critical zone to watch on the downside.
This trade is bigger than just Nvidia, as the report is seen as a referendum on the entire AI investment cycle. A positive result will likely lift other major AI players like Meta, Microsoft, and Amazon, making derivatives on the QQQ ETF another way to play the outcome. A miss could accelerate the rotation out of tech that we’ve seen since last November.
Beyond the main guidance number, we must listen for comments on gross margins and China sales during the conference call. Any sign of weakness in these areas, or a poor explanation for reducing the OpenAI investment, could undermine a positive headline number. These details will dictate market sentiment in the coming days.
The immediate reaction to the earnings release will set the tone for the market heading into March. The outcome will decide whether we pile back into the AI trade that defined 2025 or continue the flight to safety in sectors like utilities and healthcare. The positioning for the next few weeks will be determined in the next few hours.
