Martin Gamble on US markets: Nvidia powers Wall Street rebound

US markets bounced back in decent fashion through the course of the week as some of the tension around government debt and the inflationary pressures unleashed by the Middle East crisis eased.

Attention switched to corporate earnings from the technology sector, including from the world’s largest company Nvidia, which largely struck a confident tone. The exception to a broadly positive picture was the small cap Russell 2000 index which dipped a smidge.

Cybersecurity outfit Crowdstrike was among the big winners as it beat analysts’ forecast for the second quarter by posting revenue of $1.47 billion and earnings per share of $0.31 while raising its full-year guidance amid strong demand for AI-driven products.

On the flipside, memory chip play SanDisk saw further profit taking after its astonishing run earlier this year and medical device maker slumped as it reported a cyberattack. The incident is having a direct impact on its operations with an uncertain timeline to fix the issues.

Nvidia smashes expectations to reassure on AI

AI chip giant Nvidia did its bit to reassure on the sustainability of the artificial intelligence trade as it posted a strong set of second-quarter earnings and guided for third-quarter revenue to cross over the $100 billion threshold.

Nvidia beating forecasts is not news, it has surpassed revenue forecasts for 16 quarters in a row. However, not only did the company handily beat the $91.9 billion consensus estimate to chalk up revenue of $96.2 billion but it’s third-quarter and longer-term forecasts also bested expectations. The company projecting $108 billion for the third quarter and guiding for 70% revenue growth in the 2028 fiscal year as demand shows little sign of abating. Earnings per share for the second quarter came in at $2.22 against the $2.08 which had been pencilled in.

Accounts receivable is a key figure to watch; it has risen 64% over the past six months to $63 billion. This is money customers still owe for goods or services bought on credit, suggesting they may be taking longer to pay or that Nvidia is selling more products this way.

Salesforce soars on strong results and raised outlook

Software giant Salesforce’s second-quarter earnings went a long way to addressing market fears about AI disruption and in doing so enjoyed its second-best day on the stock market in its history as a public company.

The CRM (customer relationship management) specialist demolished earnings forecasts, with earnings per share hitting $5.90 against the $3.27 consensus number. 

Earnings benefited from an unrealised gain on its early investment in Claude-owner Anthropic which has seen its paper valuation surge as it gears up for a stock market listing. The company also hiked its revenue and earnings forecasts for the full year.

Significantly, Salesforce’s current remaining performance obligations metric, a measure of the pipeline of future work, also came in higher than anticipated.

While the continuing growth of artificial intelligence backed products suggested it can be a beneficiary not a victim of the AI revolution.

Dick’s Sporting Goods trips up amid fragile consumer backdrop

Sportswear and equipment chain Dick’s Sporting Goods fell flat on its face after its second-quarter earnings, the shares falling 30% in intraday trading.

Earnings per share fell to $3.53, down from $4.38 in the same period a year earlier, missing analyst expectations of $3.76. Total revenue of $5.59 billion was also short of the projected $5.65 billion.

The $2.4 billion acquisition of Foot Locker, which completed in September 2025, is already starting to look a misstep with this part of the business chalking up losses.

The company is having to resort to discounting to shift inventory and is closing stores to right-size the business. With full-year guidance slashed, there were few positives for investors to cling on to.