Nvidia Stock Rises. This Is the Next Catalyst for the AI Chip Leader.

Nvidia chips are the favored choice for training artificial-intelligence models. (Courtesy NVIDIA)

Nvidia was edging up early on Wednesday as shareholders look forward to earnings reports from major technology companies.

Nvidia shares were up 0.5% at $176.45 in premarket trading. The stock fell 0.7% on Tuesday.

The next catalyst for the stock is likely to be Microsoft and Meta Platforms earnings, with the tech companies reporting earnings on Wednesday afternoon. Both are major customers for Nvidia.

Investors will be looking for signs that spending on AI infrastructure will continue to rise, as well as indications of whether the tech companies are looking to shift toward in-house chips rather than Nvidia’s hardware.

There are plenty of would-be rivals for Nvidia’s crown in AI chips. The latest news in the sector is that start-up Groq—not to be confused with Elon Musk’s Grok AI model—is raising $600 million in funding at a $6 billion valuation, according to a Bloomberg report late Tuesday, which cited anonymous sources.

Groq didn’t immediately respond to a request for comment on the report. The start-up specializes in high-speed chips for inference, the process of producing output from AI models. Groq’s highest profile deal so far has been with Saudi Arabia’s Humain, which is also buying chips from Nvidia.

Among other chip makers, Advanced Micro Devices was down 0.4% and Broadcom was falling 0.2% in premarket trading.

Write to Adam Clark at adam.clark@barrons.com