Expert interview: Is Nvidia building a flywheel or a circular economy?
Nvidia has become the most influential barometer for the health of the AI economy. Its GPUs sit at the foundation of the massive buildout of models, data centers and AI infrastructure. But more and more, the bigger question is: what happens above the infrastructure layer? Can companies turn all that compute into applications that generate business value that moves the needle?
That makes the perspective of Anurag Gurtu, co-founder and CEO of Airrived, particularly important. He's building an enterprise agentic AI platform for cybersecurity, IT and business operations that allow AI agents to scale.
I recently spoke with Gurtu about Nvidia's upcoming earnings release. Here's what he had to say:
What are your expectations for Nvidia's performance this quarter, and what specific metrics or guidance do you most want to see?
I expect another strong quarter, but the headline number is almost secondary. The real question is whether underlying AI demand is accelerating faster than expectations. I'll watch data-center growth, Blackwell demand, margins, and, above all, forward guidance.
There is also going to be intense scrutiny around the "circular economy" of AI. Nvidia is investing in AI companies that raise enormous amounts of capital, which is then spent on Nvidia GPUs and infrastructure. It's an extraordinary amount of capital moving between chipmakers, hyperscalers, model companies, data-center operators and AI startups.
The AI economy is beginning to finance itself: capital funds infrastructure, infrastructure enables larger models and startups, and those companies consume even more infrastructure. That can create an incredibly powerful flywheel, but it also raises the obvious question of how much real economic value exists at the end of that chain.
What does this earnings report signal for the AI industry as a whole?
Nvidia earnings have effectively become the GDP report for the AI economy. But this quarter, the quality of that GDP matters as much as its growth.
The next phase of AI has to demonstrate that trillions invested in GPUs, data centers and models can translate into measurable enterprise productivity and revenue. Eventually, AI cannot survive on AI companies selling to other AI companies. Enterprises have to become the economic engine.
That's why the next trillion dollars of value won't come simply from buying more GPUs. It will come from turning compute into agents, applications and measurable business outcomes.
- Tom Taulli
Tom Taulli has been developing software since the 1980s. He sold his applications to a variety of publications. In college, he started his first company, which focused on the development of e-learning systems. He would go on to create other companies as well, including Hypermart.net that was sold to InfoSpace in 1996. Along the way, Tom has written columns for online publications such as Bloomberg, Forbes, Barron's and Kiplinger. He has also written a variety of books, including Artificial Intelligence Basics: A Non-Technical Introduction.
How will the stock market react to Nvidia's earnings?
Wedbush analyst Matt Bryson expects Nvidia to beat top- and bottom-line estimates for its fiscal 2027 second-quarter results and give upbeat fiscal third-quarter guidance on strong hyperscale spending.
Bryson also feels the results will be bolstered by "a supply position we continue to view as the best in the industry at a point where component and material access, not end demand, is defining shipments."
The question, though, is how Wall Street will react to the results. "The last three quarters, NVDA has consistently exceeded consensus (and we believe delivered to buy-side expectations), yet the stock is roughly unchanged from October of last year," he explains.
Bryson has an Outperform (Buy) rating on the chip stock and a $330 price target, representing implied upside of nearly 60% over the next year or so.
- Karee Venema
With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021, and oversees a wide range of investing coverage, including content focused on equities, fixed income, mutual funds, ETFs, macroeconomics and more.
What time is Nvidia's earnings release?
Nvidia will release its fiscal 2027 second-quarter earnings report after the stock market closes on Wednesday, August 26. The results typically come through around 4:20 pm to 4:30 pm Eastern Standard Time.
The release of Nvidia's earnings report will be followed by a conference call that begins at 5 pm EST.