Nvidia reported fiscal Q4 revenue of $68.1bn, beating estimates of $65bn. Gross margin was 75%, up from 73.5% in the prior quarter. Q1 revenue guidance was $78bn versus estimates of $72bn. The company said hyperscalers made up 50% of revenue. It also reported growing enterprise adoption of AI agents, which could expand demand beyond a small group of large buyers.

Supply Visibility And China Assumptions

Nvidia said it has secured enough supply to meet demand for several quarters. Its Q1 forecast assumes no demand from China, even though it expects a 13% revenue increase for the quarter. Cash and cash equivalents rose $20bn year on year to $62.6bn. The company is expected to update the market on progress with its GB300 chip, and it may repeat its $500bn sales pipeline forecast for this year. The US has granted licences to export less advanced chips to China. Earlier this year, Beijing approved purchases of 400,000 H200 GPUs for Tencent, Alibaba, and ByteDance. Even so, trade friction remains a constraint. The share price rose after the release but later gave back gains, staying below the 2% average move seen the day after results. The Nasdaq e-mini contract rose 1.4% after the report, and the sales pipeline forecast stayed unchanged at $500bn.

Market Reaction And Options Positioning

Looking back to this period in 2025, Nvidia delivered a blockbuster earnings report that did not trigger a major rally at first. The market looked cautious even after Nvidia beat revenue estimates and issued a strong forecast. A similar pattern has appeared again after last week’s earnings release. Fundamentals look even stronger now, but the stock’s reaction has still been fairly muted. That setup often keeps implied volatility elevated, as traders price in a big move that may not fully happen. Data shows near-term implied volatility is in the 75th percentile over the past year, which makes option premiums expensive. For stockholders, this can create an opportunity to sell covered calls a few weeks out. The goal is to collect the higher premium and earn income while the market digests the news. If the stock trades sideways or rises only slightly, like the post-earnings drift seen in 2025, the options can expire worthless and the premium is kept. Competition also matters more than it did last year. Reports from January 2026 suggest AMD’s MI300X has captured about 10% of the AI accelerator market, up from roughly 3% a year earlier. That could put a ceiling on Nvidia’s valuation and support a more range-bound approach. For investors who are more bullish and think last year’s muted reaction was only a pause before a larger rally, call debit spreads may make more sense than buying calls outright. Spreads reduce upfront cost and help offset the drag from higher implied volatility. They limit upside, but can offer better risk-reward if the stock rises without a huge surge. The 2025 analysis also flagged a possible rotation into less-favored tech areas, such as software. That appears to be happening again. Over the past two weeks, the iShares Expanded Tech-Software Sector ETF (IGV) has outperformed the VanEck Semiconductor ETF (SMH) by 4%. This suggests money may be moving away from market leaders, which supports caution on near-term, purely directional bullish bets on Nvidia. Create your live VT Markets account and start trading now.

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