Nvidia Jumps 7% on Blowout Earnings, Deepening Its Grip on the S&P 500

Nvidia shares rose as much as 7.4% in premarket trading on Thursday after the company reported fiscal second-quarter revenue of $96.2bn, up 106% from a year earlier, and forecast a 70% jump in sales for the coming fiscal year. The results eased concerns that spending on artificial intelligence infrastructure was losing momentum.

What happened

Nvidia's results, released after Wednesday's close, beat Wall Street estimates on both revenue and profit:

• Revenue: $96.2bn, up 106% year-on-year
• Earnings per share: $2.22, up from $1.05 a year earlier
• Gross margin: 75.0%, up from 72.7% in the same quarter last year
• Guidance for the October quarter implies 89% year-on-year revenue growth

Chief financial officer Colette Kress told investors the company's next-generation Vera Rubin chip platform is now in full production, with racks running at major cloud providers and AI-focused data centre operators. Nvidia shares had initially slipped in after-hours trading Wednesday, a pattern consistent with six of its last eight earnings reactions, before reversing higher once investors digested the guidance. The rally spread to the rest of the chip sector: Marvell Technology gained more than 5% and Micron and Arm each rose more than 4% in premarket trading Thursday.

Why it matters

Nvidia is now the largest single company in the S&P 500, at roughly 7.8% of the index, ahead of Apple at 6.58%. Nvidia and 19 other stocks together account for about half of the index's total weight. That concentration means a single company's earnings report can move the value of a diversified index fund by a meaningful margin, a dynamic that has already pushed some investors toward equal-weight alternatives that cap any one holding's influence.

For an individual portfolio, the effect is often invisible. An investor holding an S&P 500 fund alongside individual tech stocks may not realise how much of their total exposure already tracks Nvidia's performance. Portfolio views that break down holdings by underlying company, not just by fund or asset class, make that overlap visible rather than buried inside a single index line.

What to watch next

Nvidia's guidance lands two days before Federal Reserve Chair Kevin Warsh delivers his first Jackson Hole keynote on Friday, a speech investors are watching for signals on the path of interest rates. Boston Fed President Susan Collins said this week that rates may need to rise again unless inflation shows a sustained decline, a reminder that the rate backdrop, not just AI earnings, will continue to set the terms for how richly investors are willing to pay for concentrated growth. The broader tech earnings season continues this week, with Salesforce and CrowdStrike both posting double-digit gains on their own results.