Several big companies report earnings this week. They span AI infrastructure, cloud services, home improvement retail, and enterprise software. The market will focus on guidance, capital spending, and demand. Alibaba reported fiscal Q2 (ended 30/09/2025) revenue up 5% to 247.8 billion yuan ($34.8 billion). Cloud revenue jumped 34% to 39.8 billion yuan, above the 37.9 billion yuan expected, after 26% growth in the prior quarter.

Alibaba Earnings Setup

Alibaba has spent 120 billion yuan on capex over the past four quarters, as part of a 380 billion yuan multi-year infrastructure plan. Cloud EBITA rose 35% to 3.6 billion yuan. Quick commerce revenue surged 60% (after 12% growth last quarter). China e-commerce revenue rose 16% to 132.6 billion yuan. Alibaba reports 24/02/2026 pre-market. Estimates: EPS $1.58 and revenue $41.90; shares are up about 5% in 2026. Home Depot reports 24/02/2026 pre-market. Estimates: EPS $2.53, revenue $38.03B, and shares are up about 10% in 2026. Home Depot’s Q3 adjusted EPS was $3.74 vs $3.84 expected. Revenue was $41.35 billion vs $41.10 billion expected. Full-year guidance is for sales up about 3%, comparable sales slightly positive, and adjusted EPS down about 5%. Online sales grew 11%, and big-ticket projects rose 2.3%. Nvidia’s fiscal Q3 revenue was $57.01 billion vs $54.92 billion expected. Adjusted EPS was $1.30 vs $1.25 expected. Net income rose 65% to $31.91 billion. Data centre revenue was $51.2 billion, including $43 billion from GPU compute. Nvidia reports 25/02/2026 post-market. Estimates: EPS $1.53 and revenue $65.69B; shares are up about 2% in 2026. Salesforce reports 25/02/2026 post-market. Estimates: EPS $3.05 and revenue $11.18B; shares are down about 30% in 2026.

Salesforce And Nvidia Watch

Salesforce posted adjusted EPS of $3.25 vs $2.86 expected. Revenue was $10.26 billion vs $10.27 billion expected, and revenue rose 8.6% year-on-year. Net income increased to $2.09 billion from $1.53 billion, helped by a $263 million investment gain. Agentforce generated over $500 million, and Informatica is expected to add about three percentage points to fiscal Q4 revenue growth. With Alibaba reporting tomorrow, investors face a push and pull. Cloud growth is strong, but quick commerce is pressuring margins. That mix raises uncertainty and could lead to a sharp post-earnings move. Options pricing already implies a large swing, reflecting both AI optimism and profit concerns. In 2025, Chinese tech stocks often moved sharply on changes in capex plans and cloud revenue. Alibaba also averaged about +/- 7% moves on earnings days last year. That history supports today’s high implied volatility, and suggests traders are preparing for a move that could break the stock out of its recent range. If you expect a big move but do not have a strong view on direction, a long straddle (at-the-money options expiring this week) is one possible approach. It can profit from a large move either up or down, and is a direct bet on earnings-driven volatility. Home Depot also reports tomorrow. Sentiment remains pressured after three straight earnings misses. The key challenge is still the weak housing backdrop, which likely has not improved much in just one quarter. That keeps many traders cautious to bearish. Mortgage rates stayed high, with 30-year rates averaging above 6.5% through the end of 2025. That tends to reduce demand for large renovation projects. This supports the company’s cautious guidance and leaves room for another soft quarter. The market appears to be braced for modest results at best. A bear put spread can offer downside exposure with defined risk. You buy a higher-strike put and sell a lower-strike put. This can work if the stock drops moderately after earnings, and fits the continuing macro pressure on housing-related spending. Nvidia’s earnings on February 25 may be the most watched, given its role in the AI boom. The stock is priced for near-perfect execution after several major beats. Even a small miss on revenue or guidance could cause a sharp pullback. A key question is whether hyperscaler demand can stay at today’s rapid pace. Industry data shows global AI infrastructure spending rose by more than 40% in 2025, which supports Nvidia’s growth. But valuation already reflects much of that strength, raising the bar. Comments on supply constraints for its most advanced chips will be especially important. Because options are expensive, a bull call spread can be a defined-risk way to target more upside. If you think expectations are too high, selling a far out-of-the-money bear call spread is another approach. It can profit if the post-earnings rally is weaker than expected, and it benefits from implied volatility falling after the report. Salesforce also reports on February 25, with a different setup. With the stock down sharply this year, the main question is whether its AI products can re-accelerate growth while its core software business slows. Skepticism is high, so this report is an important test of its AI story. In the second half of 2025, enterprise software spending slowed as many companies delayed large IT projects. This headwind helps explain Salesforce’s revenue miss and increases pressure on Agentforce to show meaningful traction. Traders will likely want clear metrics on AI adoption before sentiment improves. With the stock depressed and uncertainty high, a long strangle could fit. This involves buying out-of-the-money calls and puts to position for a big move in either direction. It can pay off if earnings deliver a major upside surprise, or if weak guidance pushes the stock much lower. Create your live VT Markets account and start trading now.

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