After Nvidia’s Earnings Pop, Options Traders Set Their Sights on $260. What It Will Take to Get There.

After Nvidia’s Earnings Pop, Options Traders Set Their Sights on $260. What It Will Take to Get There.

Ebube Jones

Thu, September 3, 2026 at 9:06 PM GMT+3 6 min read

• NVDA +0.84%

Nvidia's (NVDA) latest earnings report gave investors another reason to believe the artificial intelligence (AI) spending boom still has room to run. The chipmaker delivered quarterly revenue of $96.2 billion, up 106% from a year earlier, while data-center sales climbed 117% to $89 billion. Nvidia's outlook for $108 billion in fiscal third-quarter revenue also exceeded Wall Street's expectations, helping send the stock almost 9% higher on Aug. 27.

That powerful earnings response has shifted traders' attention to the options market, where the $260 call expiring on Sept. 25 has emerged as the largest open-interest position in Nvidia's chain. The $260 level represents a high-conviction near-term upside scenario rather than a guarantee.

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Still, with Nvidia's AI-chip demand surging, its data-center business, and Wall Street continuing to raise expectations, could NVDA stock's momentum be strong enough to turn that bullish options strike into reality within a month? Let's take a closer look.

Nvidia's Earnings Momentum

Based in Santa Clara, California, Nvidia develops GPUs, accelerated-computing systems, networking equipment, and software. Its products support AI data centers, gaming, professional visualization, and automotive applications, positioning the company across several high-performance computing markets.

NVDA stock closed at $224.41 on Sept. 2. Shares are up 22% year-to-date (YTD) and up 34% over the past 52 weeks.

With a $5.4 trillion market capitalization, NVDA stock trades at 23.8 times forward earnings versus the sector median of about 22 times, while its PEG ratio of 1.7 times is also above the sector median.

Nvidia released its Q2 fiscal 2027 results on Aug. 26. The company reported $96.2 billion in revenue, surpassing analysts' $92.3 billion estimate and marking 106% year-over-year (YOY) growth. CFO Colette Kress noted that data-center revenue increased 117% YOY and 18% sequentially to $89 billion, with contributions from hyperscalers, AI cloud providers, industrial customers, enterprises, and sovereign buyers.

Revenue acceleration flowed directly into higher profitability, with adjusted operating income rising 124% YOY to $63.96 billion. That expansion produced a 66.5% adjusted operating margin. CEO Jensen Huang said rapid AI-model adoption is driving sizable infrastructure investment.

EPS rose to $2.46 from $1.08 in the year-ago quarter. The company also generated $59.7 billion in GAAP net income during the period, up 2% sequentially and 126% YOY. Nvidia's operating margin improved to 66.2% from 60.8% a year earlier. The company also generated $11.84 billion in net cash flow during the quarter.

Nvidia's $260 Options Path

Nvidia's post-earnings options setup has shifted to the Sept. 25 expiration. The $260 call is the chain's most closely watched upside strike, carrying 31,842 contracts of open interest, according to Seeking Alpha.

Bullish interest is layered underneath. The $250 call carries 28,914 contracts of open interest. The $240 strike shows 25,731 contracts, while the $230 call has 22,619. Even the far-out $300 call holds 15,847 contracts of open interest, with the strike sitting roughly 31% above current price levels.

The broader options market is more conservative. The Sept. 25 chain implies a plus-or-minus 10.1% move over roughly one month. The concentrated $260 call interest sits above the expected trading range, meaning NVDA stock would need a stronger rally than options premiums had priced into the one-month period.

Reaching $260 within the next few weeks would require Nvidia's post-earnings strength to extend. Stronger demand from hyperscalers, neocloud providers, industrial clients, and enterprise buyers could support further upward revisions to revenue and earnings estimates.

Product execution also matters. Strong adoption of Nvidia's Blackwell systems and a successful Vera Rubin ramp could reinforce confidence in the company's next growth phase. Management said Vera Rubin shipments have started and called customer uptake its fastest product launch to date.

Nvidia also has potential strategic catalysts. The company's reported $12.9 billion acquisition of Hugging Face would rank among its largest deals if completed. The transaction could deepen Nvidia's reach into AI software, models, and developer tools.

Nvidia is also investing $3.5 billion in MediaTek through convertible bonds. The arrangement expands their AI data-center infrastructure partnership, and follows Amazon's (AMZN) commitment to deploy another 2 million Nvidia components while using Nvidia interconnect technology alongside internally designed chips.

None of these developments guarantee a $260 move by Sept. 25. However, continued AI infrastructure demand, higher revenue and earnings estimates, successful Blackwell and Vera Rubin deployments, and deeper exposure to AI software and infrastructure partnerships could give NVDA stock the support needed to test that heavily watched strike.

Wall Street's Targets Leave Plenty of Room

Nvidia's next major test arrives on Nov. 18, when the company is expected to release results for the October 2026 quarter. The average earnings estimate calls for $2.47 per share, compared with $1.24 per share a year earlier, implying 99% YOY earnings growth.

That earnings outlook aligns with management's Q3 fiscal 2027 revenue guidance of $108 billion at the midpoint. The company's forecast is $3.4 billion above analysts' $104.6 billion revenue estimate.

Wall Street has already responded with higher targets. Bernstein recently increased its price target to $400 from $315, while Rosenblatt lifted its target to $390 from $325. Those targets imply potential upside of 75% and 71%, respectively.

Broader sentiment remains favorable, with 50 analysts offering a consensus "Strong Buy" rating. The average price target of $324.56 implies potential upside of 42% from current levels and stands 25% above the $260 call strike that options traders are monitoring.

Conclusion

Nvidia can reach $260, but doing so before the Sept. 25 expiration would require a stronger move than options markets currently imply. Continued AI infrastructure demand, solid product execution, and fresh strategic catalysts could keep buyers engaged. NVDA stock's direction still appears tilted higher, given its revenue outlook and analyst support. However, $260 looks more like an ambitious near-term milestone than the most likely one-month outcome.

On the date of publication, Ebube Jones did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com