Nvidia, CrowdStrike and Salesforce Face Earnings Test as AI Competition Intensifies

The S&P 500 was relatively muted Wednesday after the Federal Reserve’s preferred inflation gauge, the personal consumption expenditures price index, showed core prices remain elevated. CNBC’s Jim Cramer said he expected bond yields to pull back and stocks to rise after the warmer-than-expected data and a dip in oil prices, but investors were holding back to see what Nvidia has to say.

Shares of Meta Platforms were up slightly after the company agreed to pay $16.7 billion to settle a social media addiction lawsuit brought by a coalition of state attorneys, CNBC reported.

Nvidia shares fell about 1% ahead of the report. CNBC’s investment team said the company needs to beat analyst estimates and raise guidance, while giving more detail on its relationships with hyperscalers and AI labs, which are increasingly looking to more customized chips. On Tuesday, OpenAI said testing results for its new custom inference chip, developed with Broadcom, “show a significant performance advance.” Competition from custom chips has been a recurring topic on Nvidia earnings calls, and CEO Jensen Huang is expected to face questions about it again.

CrowdStrike and Salesforce also report after the close, testing two sides of the enterprise software market. CNBC’s Jeff Marks said investors expect CrowdStrike to discuss new deals. CrowdStrike shares have gained more than 68% since late April even after pulling back from an August high. The market has accepted that AI will not eliminate the need for cybersecurity but will strengthen it. Salesforce has rallied in recent weeks but pulled back over the past couple of days, and Marks said the software-as-a-service company needs to show it can keep growing in the AI era. Salesforce CEO Marc Benioff is scheduled to appear on CNBC’s “Mad Money” after earnings.

Other stocks discussed in the program’s rapid-fire segment included Intuit, Zoom and J.M. Smucker.