Wednesday evening, NVIDIA reported the most profitable quarter in the history of the semiconductor industry. Revenue of $82 billion, up 85% from a year ago. Net income more than doubled. An $80 billion share buyback — one of the largest announcements of its kind ever. The stock closed Thursday down nearly 2%. Friday it fell again. By the end of the week NVDA was sitting around $215, roughly 9% below its all-time high from earlier this month.

If you're confused, you're not alone. But there's actually a straightforward explanation — and the week had a lot more going on than one headline number.

The Earnings That Made the Stock Cheaper

Here's the thing about "sell the news" quarters: they don't necessarily mean the business is disappointing. NVDA has now dropped after earnings for the fourth consecutive quarter. Each time, the results were objectively strong. The stock falls because investors positioned ahead of the report, expectations were already baked in, and anyone who bought hoping for an immediate pop takes their profit and leaves.

What the earnings report actually did was change the math in NVIDIA's favor. Before results, our site showed NVDA at a forward P/E of around 27.6x — that's the price investors are paying for each dollar of next year's expected profit. After earnings, with a massive earnings beat and guidance that came in well above expectations, that same metric dropped to 23.91x on our data. The stock got cheaper, in valuation terms, even as the price fell. The PEG ratio — which divides the P/E by the earnings growth rate, where under 1.0 means you're paying less per unit of growth than the growth itself justifies — moved from 0.60 to 0.44. NVDA is now one of the cheapest large-cap growth stocks in the market by that measure. Revenue grew 85.23% over the trailing twelve months, return on invested capital sits at 133.07%, and analyst consensus upside from our site is now 45.61%. One analyst raised their price target to $500, a new street-high.

Two things from the earnings call deserve more attention than they got. First, Jensen Huang said quietly that Nvidia has "largely conceded" China's AI chip market to Huawei. Export controls and Beijing's push to buy domestic alternatives have hollowed out what was once a significant revenue stream. Huang didn't seem particularly troubled — he described a $200 billion CPU market opportunity that China is included in — but the concession is real. It's the first time he's framed it that bluntly. Second, Nvidia disclosed it spent $18.6 billion on venture investments in a single quarter. That's not operating expenses — that's strategic equity stakes in the AI companies that buy its chips. The company is building a financial ecosystem around its products, not just selling hardware.

The Company That Had the Better Week

While NVDA was drifting lower after its report, Dell Technologies had one of the most unusual trading days of the year. On Friday, shares surged 16.77% to close at $295 — a new all-time high for a stock that was trading at $106 just twelve months ago. The catalyst was a combination of analyst upgrades ahead of Dell's own earnings on May 28 and the momentum from the week's Dell Technologies World 2026 conference in Las Vegas, where the company announced a wave of AI-focused infrastructure products and revealed it had added 1,000 new enterprise customers to its AI Factory product line, bringing the total to several thousand.

The strange part: Dell's 27 Wall Street analysts have an average price target of $212 — about 28% below where the stock closed Friday. The market has completely outrun the consensus. That can mean one of two things: either the analysts are systematically underestimating how quickly enterprises will deploy AI infrastructure through companies like Dell, or the stock has gotten ahead of what the business can actually deliver. May 28 earnings will start to answer that. Dell's forward P/E from Stock Analysis sits at 22.45x — nearly identical to NVDA's 23.91x from our data — which is an interesting coincidence given how different the two businesses are. NVDA designs chips. Dell assembles them into servers, sells the full stack to enterprises, and adds storage and services on top. They're partners more than competitors. The NVDA vs. Dell comparison on this site puts both businesses side by side if you want to see the differences in profitability and growth rates.

AMD also hit an all-time high this week, riding the coattails of NVDA's strong AI demand signals. AMD separately announced a $10 billion investment commitment across Taiwan's semiconductor ecosystem. Bank of America named both NVDA and AMD as its "top AI chip picks" for what it described as the coming "agentic AI" wave — essentially AI that takes actions on your behalf rather than just answering questions.

The AI Software Layer Is About to Go Public

One storyline that got underreported this week: the AI software companies are coming to market. CNBC confirmed Wednesday that Anthropic — the AI research company backed by Google and Amazon — is on track to generate $10.9 billion in revenue in Q2 alone, a figure that would exceed its entire revenue from last year. The same day, CNBC confirmed that OpenAI is preparing to confidentially file its IPO prospectus, potentially one of the largest public market debuts in history.

This matters for a few reasons. First, it validates the revenue story at the application layer of AI — not just the chips, not just the cloud infrastructure, but the actual AI products people and companies pay for. Second, when OpenAI eventually prices its IPO, it will suck enormous capital out of existing tech stocks. Jim Cramer flagged this on CNBC: a mega-IPO like OpenAI or SpaceX (which also filed this week) can be "destructive" for the rest of the market in the short term simply by redirecting investor dollars. Third, if OpenAI is worth what it's reportedly seeking — potentially $300 billion or more — it forces a reassessment of valuations across the software layer of AI. Microsoft, which owns roughly 49% of OpenAI's commercial entity, sits at a forward P/E of 22.09x on our site with 43.28% analyst upside. If OpenAI's IPO values the partnership at what some expect, MSFT's stake becomes a material undervalued asset on its balance sheet.

The Macro Picture Got a Little Friendlier

Oil closed the week at $97 a barrel, down from $105 a week ago. Trump said Saturday that U.S.-Iran nuclear negotiations are in their "final stage." If that holds, and the Strait of Hormuz situation normalizes further, the energy cost pressure that's been grinding on airlines, consumers, and inflation readings for months starts to ease. It won't fix everything — gas prices are still elevated, and PCE inflation was already at a three-year high last reading — but it would remove one of the more concrete headwinds. XLE, the energy sector ETF, sits at a forward P/E of just 13.19x on our data, which is historically cheap; energy tends to get re-rated quickly when geopolitics shift.

Kevin Warsh was formally sworn in as Federal Reserve chair this week, saying he will lead a "reform-oriented Federal Reserve." Exactly what that reform looks like in practice is the open question. Some market watchers expect Warsh to push harder on reducing the Fed's balance sheet — essentially shrinking the amount of Treasuries and mortgage bonds the Fed holds — which could put upward pressure on long-term rates even without changing the short-term policy rate. The 10-year closed at 4.558% and the 30-year at 5.064%, both slightly lower than last week's 4.597% and 5.122%. The bond market is watching Warsh closely.

The week closed with the S&P at 7,473, the Dow above 50,000, and JPMorgan publishing a note saying they see the S&P reaching 9,000 by the middle of 2027. That's a 20% move from here in about fourteen months. History doesn't make it guaranteed, and JPMorgan has been wrong before, but a bank with that kind of research firepower publishing that kind of target publicly is a statement worth noting.

The grounded version of where things stand: NVDA's earnings were genuinely extraordinary, and the post-earnings pullback has made the stock measurably cheaper by every valuation metric we track. Dell is running on AI server demand that hasn't even fully arrived in its revenue yet. The AI software layer is about to start trading publicly. And if Iran talks land, one of the biggest macro weights on the economy starts lifting. None of that means the path is straight up — Warsh's Fed is an unknown, OpenAI's IPO will test capital allocation, and DELL earnings next week could disappoint a stock that has run very far very fast. But the fundamental picture this week was cleaner than it's been in a while.

Sources: CNBC Tech Download: What you might have missed in Nvidia's earnings · Stock Analysis: NVIDIA (NVDA) · Stock Analysis: Dell Technologies (DELL) · MarketWatch: Nvidia spent $18.6 billion on venture investments in 3 months · MarketWatch: Nvidia's on a new path, and if you own an S&P 500 index fund your money is riding on it · CNBC: JPMorgan's case for 9,000 in the S&P 500 by mid-2027 · CNBC: Kevin Warsh's real Fed 'regime change' · Invezz: Nvidia stock continues to struggle after earnings, but analysts remain firmly bullish · TipRanks: Nvidia Stock Wins a New Street-High Price Target of $500 · Market data as of May 22–23, 2026. Metric data sourced from etf-metrics.com. This article is for informational purposes only and is not financial advice.