Nvidia Delivers

Nvidia crushed expectations with a monster quarter. Now Wall Street waits for Warsh’s Friday Fed signal.

Author

Elie Zakhour
August 27, 2026

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Wednesday was the kind of session that makes you check whether the exchange is even open. The S&P 500 closed at 7,675.70, down a rounding error of 0.02%. The Dow slipped 0.21% to 53,463. The Nasdaq gave back 0.08% to 26,130. The VIX sat at 15.5 like it had a spa appointment. August has become one of the quietest stretches of the year, which is either a coiled spring or a market that has run out of opinions until Jensen Huang speaks.

Then Jensen spoke.

Nvidia dropped a quarter that would have been a religious experience two years ago: $96.22 billion in revenue versus $92.17 billion expected. Adjusted EPS $2.22 versus $2.10. Data center $89 billion, up 117% year over year. Gross margin 75%. Net income $53.95 billion, more than doubled from a year ago. The guide was the real flex: $108 billion plus or minus 2% for the third quarter, a few billion above the Street. China is a rounding error now, less than 1% of data center sales, and the outlook assumes zero. Jensen called it a “golden age of new AI labs.” Elon, never one to miss a product placement, said SpaceX wants Vera Rubin chips in orbit next year. The stock initially slipped after hours, because apparently $96 billion in quarterly revenue still requires a warm-up lap. Then, as investors digested the outlook, shares reversed sharply and rallied more than 4% in extended trading.

The morning belonged to inflation, and inflation declined to perform. July headline PCE came in at 3.7% year over year, a tick above the 3.6% guess. Core PCE, the roommate who said they'd move out in 2024, held at 3.3% – in line, unchanged, still a mile from the Fed's 2% shrine. Month over month, both printed 0.2%. Sticky, not exploding. Enough for the 10-year to hover around 4.66% and for nobody to reprice September. Kevin Warsh, the new Fed chair, has his Jackson Hole debut Friday at 10 a.m. If he talks like a hawk, this August coma ends on contact.

Meta, meanwhile, bought itself out of a public flogging. The company agreed to pay up to about $18 billion to settle a child-safety case with 48 state attorneys general – daily time caps for teens, tighter age checks, the whole “we definitely did not design this to be addictive” package, plus a denial of wrongdoing. META stock actually rose. Snap got smoked, because Pennsylvania's AG is still suing Snapchat and nobody with a functioning prefrontal cortex thinks Meta is the last company writing a check. If you build a product for people who cannot rent a car, you are now in the legal business whether you like it or not.

Peel Take: We are not impressed by an index that can’t be bothered to move on the biggest earnings print of the year, and we are not scared of a 0.02% red close either. This is a market waiting for permission. Until Warsh speaks Friday, we are not heroes here. Hold the AI compounders you actually understand, stop pretending core PCE at 3.3% is “transitory with better branding,” and if you chased Abercrombie at 3pm, congratulations, you bought a hoodie company like it was a semiconductor. 

What's Ripe

Abercrombie & Fitch (ANF) 35.67% 

  • Record Q2 sales of $1.27 billion, up 5%, the 15th straight quarter of top-line growth. EPS printed $4.17 versus about $1.97 expected – yes, including a fat tariff refund, and yes, it still beat without it.

  • Full-year EPS guide jumped to $13.10–$13.60 from $10.20–$11.00. Buybacks go to at least $500 million.

  • Abercrombie brand sales rose 8%. Hollister grew 2% against a nasty comparison. Americas +5%, APAC +19%.

  • Peel Take: A 37% rip in a name that was left for dead is Wall Street admitting it overdid the “consumer is cooked” costume. Tariff refunds juiced the EPS print, so don't tattoo $4.17 on your chest… but the guide raise is the tell. People are still paying full price for hoodies. If you need proof the 18-to-24 wallet still works, it just showed up wearing a moose.

Semtech Corp. (SMTC) 10.41% 

  • SMTC jumped 10.4% after the chipmaker beat Q2 expectations, posting adjusted EPS of $0.71 versus $0.61 expected and record revenue of $341.9 million, up 33% year over year.

  • Data-center sales surged 91% to a record $100 million, while management pointed to accelerating bookings and record backlog.

  • The real kicker was guidance: Semtech sees Q3 revenue of $405–$415 million and adjusted EPS of $1.02–$1.08, both comfortably ahead of Wall Street expectations.

  • Peel Take: Semtech did what every AI-adjacent chip company wishes it could do: turn the data-center story into actual numbers. A beat is nice. A beat plus record backlog plus a guide that forces analysts back into Excel is how you get a 10% Wednesday.

What's Rotten

Snap Inc. (SNAP) 8.45%

  • Shares slid to about $5.42 after Meta's teen-safety settlement. The market's translation: Meta paid to make the trial go away. Snap still has to sit for the exam.

  • Pennsylvania's attorney general is suing Snapchat over compulsive-use design. Other states now have a template, a number, and a press conference.

  • Snap lives and dies with users who are not old enough to rent a car. A world of daily time caps and age gates is not a feature. It is a revenue haircut with extra steps.

  • Peel Take: Snap is facing the same regulatory pressure now reshaping the broader social-media industry, but with far less financial firepower than Meta. Pennsylvania’s lawsuit adds another layer of uncertainty, while Meta’s settlement shows just how costly youth-safety scrutiny can become. The bigger question for Snap is whether tighter protections eventually weigh on engagement and advertising growth.

Zoom Communications (ZM) 7.03%

  • Zoom sank 7.0% Wednesday to $93.83 after its Q3 profit outlook came in below Wall Street expectations, overshadowing an otherwise solid quarter.

  • Q2 revenue rose 4.9% to $1.28 billion, while adjusted EPS of $1.55 topped expectations. Enterprise revenue climbed 7.8% to $787.5 million, its strongest growth in three years.

  • The problem was the next quarter: Zoom guided adjusted EPS to $1.46–$1.48, below the roughly $1.50 Wall Street was looking for.

  • Peel Take: Zoom learned the oldest earnings-season lesson in the book: Wall Street drives looking through the windshield, not the rearview mirror. A beat gets you through the door. A soft guide gets you thrown right back out. 

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