Nvidia (NVDA) reported fourth-quarter earnings after the bell on February 25. Despite the huge profit, the stock is down 5.6% as of this writing (Thursday, February 26), according to Yahoo Finance.
No matter how strong the earnings report is, it seems that Nvidia’s stock price plummets after the earnings report is released. So how come the stock price fell after reporting record quarterly revenue of $68.1 billion, up 20% quarter over quarter and 73% year over year?
Nvidia CEO Jensen Huang explained the phenomenon during an all-hands meeting following the third-quarter earnings report. “If we have a bad quarter, it’s evidence that there’s an AI bubble. If we have a good quarter, we’re fueling the AI bubble,” he said, according to Business Insider.
It is worth noting that Huang does not think artificial intelligence is a bubble.
Revenue was $78 billion, plus or minus 2%.
GAAP gross profit margin was 74.9%, plus or minus 50 basis points
GAAP operating expenses were approximately $7.7 billion Source: NVIDIA
The company said its outlook does not assume any data center revenue from China.
“While the U.S. government has approved a small number of H200 products for customers in China, we have not yet generated any revenue, and we do not know if China will allow any imports,” Chief Financial Officer Colette Kress said on the earnings call.
The statement about no China data center sales and the CFO’s comments seem like possible reasons for disappointment, but only if you have wildly unrealistic expectations.
In “What the White House Decision Means for Nvidia,” I provide an in-depth analysis of why Nvidia will have a hard time getting back on track to generate revenue from Chinese data centers.
Therefore, we conclude that AI bubble concerns are hurting the stock. I explained how the AI bubble works through OpenAI in the article “AMZN, MSFT, NVDA, SFTBY ignite $100 billion.”
Bank of America raised its 2027 non-GAAP earnings per share forecast for Nvidia to $8.11. Shutterstock ·Shutterstock
Following the release of the report, Bank of America analyst Vivek Arya and his team updated their view on Nvidia stock.
The team said Nvidia “exceeded expectations” in its first-quarter guidance, with year-over-year revenue growth accelerating to 77%.
More tech stocks:
Analysts raised their fiscal 2027/2028/2029 non-GAAP EPS estimates by 5%/10%/13% to $8.11/$10.72/$13.18, respectively, noting that they now include stock-based compensation expenses and embed a higher tax rate.
In a research note shared with me, Arya reiterated a buy rating on Nvidia stock and raised his price target to $300 from $275, based on 28 times his 2027 price-to-earnings estimate excluding cash, which is within Nvidia’s historical forward price-to-earnings range of 25 to 56.
Consumer-driven gaming market weakens
Competition with major public companies
Impact on China’s computer export restrictions exceeds expectations
Sales of new businesses, data centers and cars are volatile and unpredictable market
Potential for slower capital returns
Government steps up scrutiny of Nvidia’s market dominance in artificial intelligence chips
Nvidia has released its second annual “State of Artificial Intelligence in Healthcare and Life Sciences” survey report.
The report demonstrates how the industry is delivering return on investment (ROI) in core application areas such as medical imaging and drug discovery. It also shows that the industry is adopting open source software and artificial intelligence models to solve specific use cases.
70% of respondents said their organizations are actively using artificial intelligence, up from 63% in 2024.
82% of respondents said open source software and models are moderately to extremely important to their organization’s AI strategy.
85% of executives say AI is helping increase revenue, and 80% say AI is helping reduce costs.
Annabelle Painter, head of clinical AI strategy at Visiba UK, said: “Scaling generative AI in healthcare starts with focusing on real clinical and operational problems, rather than the technology itself.”
Related: What Nvidia isn’t showing at CES, and whether AMD should care
“Organizations that see impact are those that embed AI into existing workflows rather than layering AI as a separate tool.”
61% of medtech respondents said they are using AI for medical imaging, such as radiologists using AI to work faster and more efficiently, while 57% of pharma and biotech respondents said AI is driving drug discovery.
Due to the positive impact of AI, 85% of respondents said AI budgets will increase this year, while another 12% said budgets will remain the same. 82% of respondents said open source is moderately to extremely important to their AI strategy.
“Open models will shape the knowledge landscape,” said John Nosta, president of NostaLab, a health care think tank.
“They are critical to exploring and keeping the field honest. But in clinical settings where safety, responsibility and accountability are non-negotiable, proprietary systems will remain necessary for validation, integration and trust. The key insight here is that discovery will be open and deployment will need to be managed.”
RELATED: Nvidia’s History: Company Timeline and Facts
This article was originally published by TheStreet on February 26, 2026, and first appeared in the Investment section. Click here to add TheStreet as your preferred source.
