BlockBeats reported on Aug. 27 that Fu Peng, chief economist at Xinhuo Group, said Nvidia’s latest earnings report drew a muted response from the market even though the company has now beaten expectations for 15 straight quarters.
Fu wrote that signals from the stock price and options volatility show investors are now looking past the numbers themselves. In his words, the market is 「more concerned about the future: whether the free cash flow at the center of future equity index valuations can be delivered smoothly, and how long AI growth momentum can last. These questions actually carry more weight than a single quarter’s earnings performance, so even if this set of results beats Wall Street expectations by a few more points, it still cannot change the denominator side of valuation.」
He said Jensen Huang’s comments on the earnings call, where he stated that 「the inflection point for AI has arrived,」 were essentially aimed at reassuring the market. Fu said the purpose was to strengthen confidence that a closed-loop AI industry chain is taking shape and to ease worries about excessive investment.
Fu added that investors should now watch 「how long the market needs to digest this round of confidence-boosting, digest the higher expectations brought by Huang, and after how long this sentiment starts to fade.」
If the mood fades quickly, he said, that would suggest the market’s prevailing attitude is one of waiting for concrete results before committing. In that case, the impact of repeated efforts by companies to reinforce confidence and encourage the market would be weakening over time. Fu said this can be observed through how long market volatility lasts after each earnings call.