Nvidia is gearing up for one of Wall Street's most anticipated earnings calls in years

By Bill Peters

CEO Jensen Huang's sudden departure has made Tuesday's earnings call 'the most important in the company's history'

Nvidia's earnings call on Tuesday may not bring many 'fireworks' but investors will still be tuning in with great anticipation.

When Nvidia reports quarterly results on Tuesday, its earnings call is set to be one of the most anticipated of this century, as Wall Street tries to figure out what former CEO Jensen Huang's extramarital affairs mean for the company, artificial intelligence, world politics and the entire economy.

Quarterly earnings calls rarely attract attention outside of the financial world. But combine Huang's resignation on Thursday with his singular impact on the chip-maker and its massive importance to the broader stock market, and it'll be the closest an earnings call gets to mandatory listening.

"It's one of the most important earnings calls not just for Nvidia, but for the market," D.A. Davidson analyst Gil Luria said. "It's very important that they can communicate a steady hand on the wheel."

Nvidia's board is investigating Huang's relationship with a woman linked to a Singaporean customer and who the U.S. government reportedly believed was a spy for China. Since then, there have also been reports of two other affairs with Nvidia employees.

The company didn't respond to a MarketWatch request for comment.

Nvidia (NVDA) has appointed Colette Kress, the company's chief financial officer, as interim CEO.

"'Interim' means the real decision is still ahead, the investigations are still open, and Tuesday's earnings call just became the most important in the company's history," Mark Malek, chief investment officer of Siebert Financial, said in emailed remarks.

Michael Kramer, the founder of Mott Capital Management, noted that the whole market would be dependent on Nvidia's remarks.

D.A. Davidson's Luria said that against a backdrop of colossal growth in the AI industry, every round of Nvidia's earnings has carried historical importance. And while investors have a lot of questions, he and others think executives are likely to stay cautious with how they respond to questions related to Huang.

"The anticipation is incredibly high, and it should be incredibly high, and it's unlikely, for that reason, to offer much," John Blank, chief equity strategist at Zacks Investment Research, said of Tuesday's call.

Brian Colello, an analyst at Morningstar, said the call would "certainly be one of the more unique calls we'll have with Nvidia," but perhaps not the most important, since the CEO transition has yet to be settled. StoneX analyst Cody Acree suggested Tuesday's earnings call was likely to generate a high level of attention, but few fireworks.

"Obviously people will be paying more attention to Nvidia here, but I don't know if there's going to be a lot more to be said," he said. "They're not going to get into the specifics of Jensen's resignation."

Management, he said, would likely avoid any questions about the matter until they get more information from the investigation.

"Some of that we may never know the details of, just because those will be kept internally," he said.

Steve Sosnick, chief strategist at Interactive Brokers, told MarketWatch that "there are innumerable uncomfortable questions" that can come Nvidia's way. "Wrong answers can get punished."

Over the past three decades, Huang has turned Nvidia from an idea at a Denny's booth in California to a multi-trillion-dollar company whose chips have powered the AI buildout. He became the rare CEO to take on celebrity-like status, with leather jackets his fashion default. He was arguably the face of the AI industry that has propped up the S&P 500 SPX, and his downfall has drawn comparisons to a TV drama and been described as one of Shakespearean proportions.

Hendi Susanto, a portfolio manager at Gabelli Funds, said Huang's departure was a massive shock for the company. But he said that Nvidia had become more than just one executive, and said its customers were unlikely to cancel their orders.

"That ecosystem doesn't disappear with him," he said in emailed commentary. "The culture of rapid innovation he created is built into Nvidia's engineers and its roadmap. We see no major impact on Nvidia's roadmap at least in the next two years."

Nvidia has regularly been among the biggest contributors to the S&P 500's earnings growth. But as of Friday, the company's stock had fallen 8.9% over the past five days, and around 25% over the past month, as Huang's resignation, the ever-expanding tab for AI development and the prospect of more scrutiny under a Democratic-controlled Congress next year keep investors worried. Huang's downfall has also raised questions about Nvidia's business with China, its circular financing deals and oversight in Washington.

Earnings calls are usually jargon-laden affairs where analysts ask executives about things like "margin cadence" and "elasticities." But on occasion, they break containment into the broader culture.

Following the meme-stock rampage in 2021, GameStop's (GME) earnings calls drew scores of novice retail traders, even though the calls themselves lasted minutes and offered only canned remarks. In a 2020 earnings call, as the pandemic kept people indoors, Tesla (TSLA) CEO Elon Musk ranted about shelter-in-place orders, calling them "fascist" and saying: "Give people back their goddamn freedom." Tech leaders rallied around the remarks, which made national news.

In 2017, JPMorgan Chase (JPM) CEO Jamie Dimon went off about U.S. political gridlock, complaining about the "stupid shit we have to deal with in this country." In 2012, Dimon initially brushed off reports of big derivative bets by a trader nicknamed the London Whale as "a complete tempest in a teapot." After those bets turned into billions in losses, Dimon told NBC's "Meet The Press" that his initial assessment was "dead wrong," and said the bank made an "egregious" mistake.

And in 2001, when fund manager Richard Grubman asked Enron CEO Jeffrey Skilling why the company couldn't produce a balance sheet or cash-flow statement with its earnings, Skilling replied: "Well, thank you very much. We appreciate that. Asshole," according to a Reuters report at that time.

Skilling accused Grubman of short-selling shenanigans. But it was an early sign of things to come. Months later, Enron collapsed in one of the biggest accounting scandals ever.

Still, Luria, at D.A. Davidson, said he hadn't seen anything quite like Nvidia's most recent week.

"I was around for Worldcom, I was around for Enron," he said. "This is probably the most impactful crisis of any of those."

Joseph Adinolfi contributed reporting.

-Bill Peters

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11-15-26 1000ET