Stellar earnings send NVDA tumbling 📉

Real gains are found below the radar

August 27, 2025

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Good evening, Folks,

We just had the biggest earnings event of the season — and of the last many seasons — NVDA.

As I wrote yesterday, the hype is justified. NVDA’s market cap is now bigger than the market cap of the entire UK stock market — and it’s not far off from the entire Japanese market.

And true to form, the company released blockbuster earnings. Some highlights:

  • Earnings per share of $1.05 adjusted vs. $1.01 estimated. In the year-ago period, the figure was 68 cents per share.

  • Revenue of $46.74 billion vs. $46.06 billion estimated. And it expects revenue in this quarter to hit $54 billion — without any H20 processor shipments to China.

  • Net income increased 59% to $26.42 billion

For a normal company, this would send the stock soaring, but investors have sky-high expectations from NVDA.

The gist of the earnings call was, "We made another gazillion dollars, and probably will for the next few years..."  (paraphrased!) 

Nothing the market didn't expect.

As a result, the stock is down about 3% after-hours as of this writing, and frankly, I think we may see a bigger drawdown tomorrow.

That’s because market makers love to keep stocks like NVDA in a tight range after hours because there is a huge volume of calls and puts outstanding.

If they pin the stock in a tight range, they can make a killing on the options when the market opens tomorrow (can't trade options until the market opens), when the volatility dies. 

Then, the true move can happen (which is probably lower, unfortunately).

My guess is that NVDA will sell off during the day tomorrow when bigger players can take advantage of the options…

It’s a good lesson on why it is a dangerous game to try and buy options on stocks headed into earnings!

As I wrote to you, I was primarily focused on my “tactical trade” idea, which did not disappoint.

That makes it seven occasions now that I’ve alerted that stock, and it made double-digit intraday gains.

Did you have a lot of other trades make a move like this today?

Probably not… so pay attention to what’s coming up next!

I’m taking aim at another small stock tomorrow — one that I haven’t alerted before. 

The company is making a big pivot and I’m watching to see if investors give it a bounce tomorrow.

Tune in to your inbox at 9am ET tomorrow for all the details.

To Your Success,

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