The upcoming financial results of Nvidia, set to be released on Wednesday, are eagerly anticipated by analysts, particularly in relation to the sales of their artificial intelligence chip, Blackwell.

This comes amid claims from a Chinese competitor that they can train competitive AI models using significantly fewer resources. Wall Street predicts that Nvidia will report fourth-quarter adjusted earnings of 85 cents per share on revenue of $38.08bn, according to FactSet, with net income expected to reach $19.58bn.

The performance of Nvidia is crucial for the entire US stock market as it has grown into the second-largest company on Wall Street, meaning its stock movement carries significant weight on the S&P 500 and other indexes, surpassed only by Apple.

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Now worth over $3tn, the Santa Clara-based tech giant, along with other companies benefiting from the AI boom, have been instrumental in driving the S&P 500 to record highs, despite concerns about high inflation and potential economic impact from tariffs and other policies of President .

Nvidia was responsible for more than a fifth of the S&P 500 index's total return last year, outperforming the other 499 companies in the index. If Nvidia struggles to maintain its momentum, particularly given concerns that its stock price has risen too high and too quickly, Americans with S&P 500 index funds in their 401(k) and other investment accounts may face losses.

The company's fourth-quarter earnings report, its first since Chinese firm DeepSeek claimed to have developed a cost-effective large language model rivaling ChatGPT and other US competitors, will be closely watched. DeepSeek's announcement briefly wiped $595bn from Nvidia's value, but the company praised DeepSeek's work as "an excellent AI advancement" utilizing "widely-available models and compute that is fully export control compliant."

Nvidia has been at the forefront of the AI applications race, thanks in part to founder and CEO Jensen Huang's successful bet on chip . The company has a history of making bold moves, including inventing the graphics processor unit (GPU) in 1999, which helped drive the growth of the PC market and transform computer graphics. Nvidia's quarterly earnings will be released after the market closes on Wednesday.