Nvidia posted $81.6 billion in revenue last night. Beat the Street by 3%. Margins held at 75%. Guided next quarter to $91 billion. Jensen Huang said demand has gone parabolic. And the stock fell. Meanwhile, Walmart cut its full-year guidance because consumers are trading down to essentials — groceries and household basics, not discretionary goods. The Dow still hit a record close. But not because of Nvidia. Because oil fell another 2% on reports that an Iran deal might be close. The most important earnings print of the year just came and went, and the market told you the next move comes from the Strait of Hormuz, not from a data center.
The Close
Record close for the Dow — 50,286, up 276 points. But it took a late-day rally to get there. The S&P 500 gained 0.2% to 7,446. The Nasdaq was barely green at 26,293. And the Russell 2000 surged 2.6% — its best day in weeks, snapping three straight sessions of losses. The tape spent most of the day in the red, then flipped in the final hour on reports that the U.S. and Iran could be close to an agreement. Oil fell another 2% to $96.35.
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| Nvidia (NVDA) | $81.6B rev | beat, −0.8% | ||
| Walmart (WMT) | guide cut | −6.4% | ||
| Dow Jones | 50,286 | record close | ||
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| Health Care |
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+0.8% | ||
| Utilities |
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+0.5% | ||
| Energy |
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+0.3% | ||
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+0.2% | ||
| Communication Services |
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0.0% | ||
| Information Technology |
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−0.2% | ||
| Materials |
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−0.3% | ||
| Financials |
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−0.4% | ||
| Industrials |
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−0.5% | ||
| Consumer Discretionary |
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−1.0% | ||
| Consumer Staples |
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−1.2% | ||
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Nvidia's numbers were clean. Revenue of $81.6 billion, up 85% from a year ago. Data center revenue hit $75.2 billion, up 92%. Gross margins held at 75%. Non-GAAP earnings of $1.87 per share beat the $1.77 estimate. Next-quarter guidance of $91 billion — excluding China — was above the Street. The company announced an $80 billion buyback and raised the dividend from a penny to twenty-five cents. Jensen Huang said "demand has gone parabolic" and called the AI buildout "the largest infrastructure expansion in human history." And the stock finished down. That's the tell. When a company beats on every line, guides above, raises the dividend, announces a buyback, and the stock doesn't go up — the beat was already in the price.
Walmart told the other half of the story. Revenue of $177.8 billion was fine — up 7.3% and above estimates. But the company cut its full-year earnings guidance to $2.75-$2.85, below the $2.91 the Street expected. The reason: consumers are trading down. They're buying groceries and household basics, not clothes and electronics. Higher fuel costs are squeezing margins. The stock fell 6.4% — the Dow's biggest loser.
Intuit fell 15% after announcing it would cut 17% of its workforce. SpaceX filed IPO paperwork — the first sign that the private space economy is coming to public markets. Iran's Supreme Leader issued a directive to keep enriched uranium in the country, complicating peace talks — but later reports of progress toward a deal sent oil lower and stocks higher in the final hour.
What The Market Is Pricing In
Stocks don't price today. They price the next six to twelve months. And what the market priced today is the end of AI earnings as the primary catalyst and the beginning of geopolitics as the one that matters.
Here's the chain. Nvidia beat on every metric. Revenue up 85%. Margins at 75%. Guidance of $91 billion for next quarter. In any other week, that print would have sent the Nasdaq up 3%. Today it was flat. The reason is what I've been writing about all week: the 10-year at 4.56%, hike odds near 50%, the 30-year just off its highest level since 2007. At those yields, even a perfect Nvidia quarter can't push the multiple higher. The earnings quality is there. The willingness to pay for it isn't — not with the risk-free rate this high.
What did move the tape was oil. WTI fell to $96 — down almost 8% in two days. Brent dropped below $103. The reason: reports of progress on an Iran deal. When oil falls, the whole inflation math changes. Lower oil means lower gas prices, lower transport costs, lower input costs — and eventually lower CPI. And lower CPI means the Fed can wait instead of hike. The market sniffed that chain in the final hour and bought the Dow to a record.
Nvidia beat on every line and the stock fell; oil dropped 2% on Iran hopes and the Dow hit a record. That's the market telling you the next 10% move in the S&P doesn't come from an earnings call — it comes from whether the Strait of Hormuz reopens. If it does, oil falls to $80, inflation cools, the Fed stands pat, and the rally resumes on a broad base. If it doesn't, oil stays above $100, hike odds keep climbing, and the AI trade runs out of people willing to pay 40 times earnings at a 5% risk-free rate.
I've seen this handoff before. Q3 2021. Apple, Amazon, Meta, and Google all reported strong quarters in late October. The stocks barely moved. The market had priced the earnings in advance. The index didn't peak until January 2022, but the mega-cap earnings stopped being the catalyst after that cycle. What moved the market next was the Fed. Today the catalyst is shifting from AI earnings to the price of oil. Same pattern: when the earnings are priced in, the market goes looking for the next thing.
The Russell 2000 surging 2.6% tells you where the money wants to go if the macro cooperates. For three days, small caps got crushed in a flight to quality. Today they led — up 2.6% while the Nasdaq was flat. If oil keeps falling and an Iran deal comes together, the small caps run. That's the broadening trade everyone has been waiting for. It just needs the Strait to reopen.
What's Next
Three things I'm watching:
01 — Iran deal timeline
Trump said the administration is in the "final stages" of talks. Iran's Supreme Leader complicated the picture by ordering enriched uranium kept in-country. But the market rallied on reports of progress. The next 48 to 72 hours are the window. If a framework emerges this weekend, oil falls below $90 on Monday and the Dow extends the record run. If talks collapse, Trump warned of strikes "in two or three days" — and oil goes back above $110.
02 — Nvidia stock reaction through Friday
The stock fell on the print. That doesn't mean it's done reacting. Options worth $355 billion in swing value are still unwinding. If Nvidia closes the week above where it opened today, the beat-and-hold pattern confirms the floor. If it drifts lower by Friday, the market is saying even $91 billion in guided revenue isn't enough to justify the valuation at these yields.
03 — Consumer follow-through from Walmart
Walmart said consumers are trading down. Home Depot beat on Tuesday but the stock fell. If more retailers flag the same pattern — essentials over discretionary, trade-down over trade-up — the consumer read for the second half gets worse. Ross Stores and Deere reported today after the close. Ralph Lauren surged 10% on a strong quarter and upbeat guidance — but that's the high end of the consumer, not the middle. The question isn't whether people are spending. It's what they're spending on.
Nvidia delivered everything the bulls wanted. The market said thank you and moved on. The Dow hit a record because oil fell, not because AI grew. The next leg of this rally doesn't come from a chip — it comes from a barrel.
That's it for today. See you tomorrow after the close.
