Nvidia Stock Is Rallying Thursday: What's Driving The Action?

NVIDIA Corp (NASDAQ:NVDA) shares are trading higher Thursday following strong quarterly reports from Microsoft Corp (NASDAQ:MSFT) and Meta Platforms Inc (NASDAQ:META). The stock also took another leg higher following reports suggesting a potential easing of chip restrictions.

What To Know: The U.S. is considering pulling back on Nvidia chip sales restrictions to the United Arab Emirates, Bloomberg reported Thursday.

People familiar with the matter said President Donald Trump could be preparing to announce a bilateral chip deal in a planned trip to the Gulf region.

Although on official decision hasn’t been made, talks of a potential easing have reportedly been picking up momentum at the White House and the Commerce Department.

Trump is scheduled to make a trip to the UAE on May 15 as part of a broader visit to the Middle East slated to begin on May 13. The report indicates that companies are currently slated to start complying with the AI diffusion rule, which caps AI chip exports on about 100 countries, beginning that same day.

Nvidia shares popped on the report, nearly touching $115 per share in trading Thursday before pulling back. The stock was still up approximately 4% at the time of writing, buoyed by AI optimism following strong reports from Microsoft and Meta.

Microsoft shares were up about 8.5% at last check after the company beat analyst estimates for the third quarter, driven by strong Azure and cloud services growth, which increased 33% year-over-year in the quarter.

Microsoft CEO Satya Nadella said AI and Cloud are “essential inputs” for every business in the company’s earnings release.

Check This Out: Microsoft’s Blockbuster Quarter Cements Goldman’s Bullish AI, Cloud Thesis

Meta also reported strong quarterly results after the bell on Wednesday and raised its full-year capital expenditures forecast, which helped boost several AI-related names, reinforcing confidence in AI spending growth.

"This updated outlook reflects additional data center investments to support our artificial intelligence efforts as well as an increase in the expected cost of infrastructure hardware," the company said.

Nvidia is set to report first-quarter financial results after the market close on May 28. Analysts are currently forecasting earnings of 88 cents per share and revenue of $43.07 billion, according to estimates from Benzinga Pro.

The U.S. government informed Nvidia in April that it will need a license to export certain chips to China. The company said last month that it expected its first-quarter results to include up to $5.5 billion of charges associated with products held in inventory as a result of the restrictions.

NVDA Price Action: Nvidia shares were up 4.04% at $113.32 at the time of publication Thursday, according to Benzinga Pro.

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