Nvidia stock poised to swing more than 7% as crucial earnings report will test the market rally

Nvidia (NVDA) stock is expected to experience a 7.4% swing the day after the AI chipmaker reports its quarterly earnings on May 28, according to options traders tracked by Bloomberg. This anticipated movement is lower than the average 11.3% fluctuation seen in Nvidia shares over the past eight quarters following earnings reports. Despite this, investors are gearing up for potential volatility in Nvidia stock on May 29.

In February, Nvidia shares dropped 8.5% after the company’s fourth-quarter earnings exceeded Wall Street’s expectations, but its first-quarter gross margin outlook fell short of estimates. Following the earnings report, Nvidia shares saw a range of 11.4%, with prices rising by as much as 2.8% and falling by as much as 8.6%. Options traders are bracing for similar volatility in the upcoming trading session.

While the expected range of movement for Nvidia stock on May 29 could result in gains or losses of up to 7.4%, there are various other potential scenarios to consider. The stock could see increases of up to 5.4% or declines of up to 2%, or it could fall by as much as 4% and then rebound by 3.4%. Despite the volatility, historical data suggests that holding onto Nvidia shares following earnings reports has yielded substantial returns for investors.

Nvidia’s upcoming earnings come amidst a challenging year for the company, with AI developments in China and shifting trade policies impacting its performance. Concerns over a potential slowdown in AI data center investments, particularly from major customer Microsoft, have added to the uncertainty surrounding Nvidia’s outlook. Additionally, trade tensions between the US and China, including export bans on Nvidia’s chips and threats of reciprocal tariffs, have weighed on the stock.

Recent positive developments, such as a temporary trade truce with China, Nvidia’s expansion into new markets like Saudi Arabia, and policy changes favoring the company, have helped boost Nvidia shares leading up to the earnings report. Analysts are expecting strong earnings and revenue growth for Nvidia’s fiscal 2026 first quarter, with revenue projected to rise over 66% to $43 billion and adjusted earnings per share to increase by 44%.

Investors will be closely monitoring the impact of recent trade policies on Nvidia’s sales to China, as CEO Jensen Huang has estimated a $15 billion loss due to the export ban. As Nvidia prepares to release its earnings results, market participants are bracing for potential market-moving news that could impact the stock’s performance in the coming days.

Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com. Stay tuned for the latest technology news that may influence the stock market and read the latest financial and business updates from Yahoo Finance.