Nvidia's 11% YTM Gain Masks Explosive AI Chip Demand Ahead of Earnings
Key Takeaways
- Despite a modest 11% rise for Nvidia and similar underperformance from Celestica, the AI chip ecosystem is gearing up for a massive earnings season.
- Data center demand for GPUs and advanced manufacturing is outstripping supply, suggesting that the stocks may be poised for a rapid catch-up.
Mentioned
Key Intelligence
Key Facts
- 1Global X AI & Technology ETF is up 23% year-to-date in 2026, nearly double the Nasdaq Composite's 13% gain.
- 2Nvidia shares have returned only 11% in 2026, lagging the broader AI rally despite robust demand for its data center GPUs.
- 3Bank of America analyst Vivek Arya believes AI infrastructure build-out will continue to drive the stock market for the rest of the year.
- 4Component shortages boosted shares of Micron Technology, Advanced Micro Devices, and Sandisk in the first half of 2026.
- 5Nvidia and Celestica are considered attractively valued ahead of the second-quarter earnings season, with strong bottom-line growth potential.
- 6Celestica is a key supplier in the AI infrastructure ecosystem, providing electronics manufacturing services to hyperscalers and chipmakers.
Nvidia Corp.
Company- Founded
- 1993
- Employees
- 32,000+
Designs GPUs and AI accelerators that power the majority of AI training and inference workloads. Data center segment is the primary growth driver.
Analysis
- Data center revenue projected to grow 120%+ in Q2
- Upcoming Blackwell and Rubin architectures maintain performance lead
- Strong pricing power from component shortages
- Custom ASICs from Google, Amazon may erode inference share
- High valuation multiples leave little room for disappointment
- Regulatory risk from export controls on advanced chips
Driven by AI infrastructure demand
Analysis
The AI model scaling race isn't slowing, and neither is the need for more compute. Nvidia's upcoming earnings could showcase triple-digit data center revenue growth, while Celestica's advanced packaging and assembly lines are running at full tilt. The market's 23% AI ETF gain tells only part of the story—the real action lies in whether these infrastructure enablers can convert surging demand into bottom-line beats that the market hasn't yet priced in.
Artificial intelligence continued its dominance over the broader stock market in the first half of 2026, with the Global X Artificial Intelligence & Technology ETF surging 23% year-to-date through early July, nearly doubling the tech-heavy Nasdaq Composite's 13% gain. This performance underscores the sustained momentum behind AI infrastructure investment, even as some of the sector's bellwether names have lagged. Nvidia, the undisputed leader in AI chips, has managed only an 11% rise in 2026, a modest advance that belies the company's underlying earnings growth trajectory and the explosive demand for its data center GPUs. Celestica, a lesser-known but critical provider of advanced manufacturing and supply-chain solutions for AI hardware, has similarly underperformed, creating a potential opportunity as second-quarter earnings season approaches. Bank of America analyst Vivek Arya points to the ongoing build-out of AI infrastructure as a primary market driver for the remainder of the year, fueled by component shortages that already lifted shares of Micron Technology, Advanced Micro Devices, and Sandisk in the first half. The tight supply of high-bandwidth memory and advanced packaging has created a favorable pricing environment for those with capacity, and Nvidia's upcoming Blackwell and Rubin product cycles are expected to amplify this dynamic. Meanwhile, Celestica's role as a key partner to hyperscalers and semiconductor firms positions it to benefit from the capital expenditure wave that shows no signs of abating.
Nvidia, the undisputed leader in AI chips, has managed only an 11% rise in 2026, a modest advance that belies the company's underlying earnings growth trajectory and the explosive demand for its data center GPUs.
What to Watch
For investors, the narrative hinges on whether the earnings season will validate the elevated spending forecasts. Hyperscale cloud providers have indicated capital expenditure budgets exceeding $250 billion for 2026, much of it directed toward AI compute. Nvidia's data center revenue alone is projected to grow at a triple-digit rate, and any upside surprise could trigger a sharp re-rating of the stock, which trades at a discount to its historical multiples relative to earnings growth. Celestica, with its diversified exposure across networking, storage, and power solutions for AI clusters, is forecast to deliver mid-teens revenue growth and margin expansion. The stock's valuation, well below that of more prominent AI hardware names, could attract attention if management raises guidance.
However, risks remain. Trade tensions, particularly around semiconductor exports, and the potential for a cyclical slowdown in enterprise AI spending could temper enthusiasm. Competition from custom AI accelerators (such as Google's TPU and Amazon's Trainium) erodes Nvidia's market share in inference workloads. Celestica faces its own challenges, including customer concentration and the inherent cyclicality of electronics manufacturing. Still, the overarching trend of AI adoption across industries — from autonomous driving to drug discovery — provides a long runway. The current setup, with these two stocks trading at attractive valuations just before what could be a catalyst-rich earnings season, suggests that the AI trade is far from exhausted and may soon broaden beyond the megacap names that have dominated headlines.
From the Network
AI ETF Surges 23% in 2026: Nvidia and Celestica Could Soar This Earnings Season
The AI-focused ETF has delivered 23% gains year-to-date, crushing the broader Nasdaq's 13%. With earnings season here, underperforming but fundamentally strong stocks Nvidia and Celestica offer compel
StartupsThe 18% Adoption Gap: Why the AI Infrastructure Supercycle is Just Beginning
New research reveals that only 18% of businesses have integrated AI into daily operations, despite years of market hype. This massive adoption gap, paired with a projected $7 trillion infrastructure r
SaaSAI Adoption Gap: Why the 18% Enterprise Usage Rate Signals a $7T Supercycle
New research reveals that only 18% of businesses have integrated AI into daily operations, highlighting a massive adoption gap. With McKinsey projecting a $7 trillion infrastructure requirement by 203
How we covered this story
Every story in our ai coverage is assembled from multiple primary sources, cross-referenced for factual consistency, and scored along three independent dimensions: sentiment, operational impact, and source-cluster confidence. Single-source rumors and unverifiable claims do not pass our editorial gate. When a story shows "Verified by N sources" with N≥2, the development is independently corroborated; when N=1, we mark it explicitly so readers can weigh the signal accordingly.
Impact scoring uses a 1-10 scale weighted toward regulatory, financial, and operational consequence rather than coverage volume. A topic that runs in every outlet but moves no real decisions ranks lower than a niche regulatory filing that reshapes how operators in the ai space have to behave. Read our full methodology for the scoring rubric, our glossary for term definitions, and our trends index for the longitudinal view across the beat.
| Signal on this page | What it tells you |
|---|---|
| Verified by N sources | Independent corroboration count. N≥2 is our confidence floor; N=1 is marked explicitly. |
| Impact score (1-10) | Regulatory + financial + operational weight. 8+ signals an experienced-operator action item. |
| Sentiment | Five-tier classification trained on labeled ai-specific corpora. |
| Timeline | Where applicable, the related-events sequence that contextualizes today's development. |