AI capex sustained but with China decoupling tail risk

Moved from 2.1.5 0.86 ± 0.04 to 0.85 ± 0.04 - mean step of -0.01 on the NVDA print, the named tell. NVDA reported Q1 FY2027 after the Wednesday close (Street ~$78.8B revenue / ~$1.77 EPS) and the initial after-hours reaction was muted-to-negative on lower-than-expected sales-forecast guidance - the Q2 guide, the operative variable, failed to clear the priced-for-perfection bar. That is the relevant negative for a capex-sustained thesis (forward guide, not the beat). The step is held to -0.01 because the demand side stayed firm intraday: AMD closed +8.10% on memory-supply tightness and the broad AI complex rallied (Nasdaq +1.54%). Reported NVDA figures are pending full release, so the after-hours-reaction evidence is evidence-moderate and the structural read is unchanged - hence width holds at 0.04. Beta(60, 10.6) ~71 effective observations.

Hyperscaler AI capex continues at elevated pace into 2026. AMD Q1 2026 (May 5 AH) materially confirmed the demand side - revenue $10.3B vs $9.88B consensus, Data Center +57% YoY at $5.8B, Q2 guide $11.2B vs $10.3B consensus, Lisa Su quoted "tens of billions" by 2027. NVDA Q1 FY2027 (May 20 5 PM ET) is the next binary tell - consensus $78.8B revenue (+77% YoY) / $1.77 EPS; Q2 guide near $86B is what the after-hours reaction rides on; options price an 8-10% implied move; prediction-market beat probability is ~97% priced in - the asymmetry is unfavorable on the upside, and NVDA has closed lower on 4 of its last 5 earnings reports despite beating revenue 3-4% for six straight quarters. Huang estimates the unrealized China market at ~$50B "effectively gone with no clear return timeline". The May 14 H200 export approval to ~10 Chinese firms (Alibaba, Tencent, ByteDance, JD.com plus Lenovo and Foxconn) holds through the weekend into Monday and through Tuesday morning - the Trump-Xi summit concluded with no AI-policy reversal or extended-export-control reinstatement. Friday May 15 delivered broad chip profit-taking on the oil shock / rate-up backdrop: NVDA 225.32 (-4.42%), AMD 424.10 (-5.69%), INTC -8% to ~$108 (after a YTD +214% run), MU -6.6%. CSCO printed a divergent +13.4% to 118.21 confirming the Wed-AH Q3 print (FY26 AI orders raised to $9B from $5B, HSBC upgrade to Buy with $137 PT). Monday close NVDA $222.32 (-1.33%), AMD $420.99 (-0.73%), QQQ $705.88; Tuesday close NVDA 220.61 (-0.77%), AMD 414.05 (-1.65%) on pre-earnings positioning, with Wednesday pre-market NQ futures +0.8% recovering ahead of the after-close print. The PHLX Semiconductor Index sits ~32% above its 50-day moving average after a +143% trailing year - a consolidation setup. The Rubin architecture H2 2026 ramp is the positive overhang investors are watching for. Update May 20: NVDA reported Q1 FY2027 after the close and the initial after-hours reaction was muted on lower-than-expected guidance - the Q2 guide, the operative variable, did not clear the priced-for-perfection bar; the demand side nonetheless stayed firm intraday with AMD 447.58 (+8.10%) on memory-supply tightness and a broad AI rally.