The 2024 Q4 earnings cycle is slowly grinding to a halt, with most S&P 500 companies already reporting their quarterly results. The period has remained positive, underpinned by a strong showing from both technology and finance companies.

And looming large is AI-favorite Nvidia NVDA, whose report likely reflects one of the most important of the cycle overall. Over the past several years, we’ve all become highly familiar with the high flyer’s story, which has been fueled by unrelenting demand for its Data Center products.

Let’s take a closer look at how the titan stacks up heading into the release.

Can NVIDIA's Results Shake Share Slump?

Nvidia shares have taken a notable breather over the past six months, essentially flat and underperforming relative to the S&P 500’s 8% gain. It’s worth noting that the past two quarterly releases haven’t led to post-earnings positivity despite the results being fantastic, reflecting that most of the positivity had already been baked in.

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As expected, the real focus of the release will surround its Data Center results, which have regularly been robust for some time now thanks to the above-mentioned demand picture surrounding the AI frenzy. For the period, our consensus Data Center sales estimate stands at $33.5 billion, well above the $18.4 billion mark in the year-ago period.

As shown below, the company has regularly blown away our Data Center expectations, ringing in six consecutive beats that have all been in excess of at least $1.4 billion.

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It’s very reasonable to expect the company to spend a great deal talking about the demand picture, particularly so after the recent DeepSeek dilemma and the doubling down of CapEx plans among many Mag 7 members (Alphabet, Microsoft MSFT, Meta Platforms META, and Amazon) over the past month.

Nonetheless, it’s critical to note that analysts have gone silent concerning EPS and sales revisions over recent months, with the $0.84 per share expected unchanged and suggesting 61% YoY growth. The chip titan is forecasted to post $37.7 billion in sales, 70% higher than the year-ago figure.

As shown below, the company’s sales growth has been nothing short of remarkable over recent years, seeing a clear acceleration from the AI frenzy.

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The valuation picture here remains fair despite the massive run, with the current 30.4X forward 12-month earnings multiple nowhere near the five-year median and a fraction of five-year highs of 106.3X. Further, the PEG ratio works out to 1.5X, again well beneath historical values.

Keep in mind that shares traded well above current valuation levels in 2020 and 2021, a time when the AI theme had yet to emerge fully.

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Putting Everything Together

Nvidia’s NVDA release will cap off the Q4 reporting cycle for the Mag 7 group, with the report likely the most important of all. Investors will be zeroed in on commentary surrounding the demand picture, particularly so following the DeepSeek spook and reconfirmed CapEx plans from hyperscalers Microsoft and Meta Platforms.

Microsoft MSFT maintained its CapEx outlook for its FY25 (roughly $80 billion) to continue fueling its AI infrastructure buildout. Meta Platforms META expects CapEx in a band of $60 – $65 billion for its FY25, unchanged from prior guidance.  

Guidance will be critical for the post-earnings move, particularly so following recent tariff talks and a broader drop in consumer confidence. Still, the company is poised to post another set of robust quarterly results, and the AI story certainly isn’t going anywhere anytime soon. Shares reflect a prime opportunity to reap the benefits from the broader multi-year infrastructure buildout.

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This article originally published on Zacks Investment Research (zacks.com).

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