Nvidia Bulls Dominate Options Market Amid Signs of Resilient Demand

$NVIDIA Corp(NVDA)$   bulls dominated option block trades Friday as financial results from Google-parent $Alphabet(GOOGL)$   and OpenAI added to evidence of resilient demand for chips used to power artificial intelligence applications.

While the biggest of the block option trades was neutral, the three transactions below that were all bullish with combined premiums of almost $34 million.

Shares of Nvidia have rebounded from an 11-month low, paring this year’s decline, after President Donald Trump softened his tone on tariffs that investors feared could push the global economy into recession, crimping corporate profits. Financial results from two of the chip giant’s biggest customers are also providing an added boost. 

On Thursday, Google-parent Alphabet’s first quarter financial results showed the company’s capital expenditures climbing 43% to $17.2 billion, modestly exceeding Bloomberg consensus that called for $17.1 billion. 

“A strong relationship with NVIDIA continues to be a key advantage for us and our customers,” Alphabet CEO Sundar Pichai said in the company’s earnings call with analysts Thursday. “We were the first cloud provider to offer NVIDIA's groundbreaking B200 and GB200 Blackwell GPUs and will be offering their next-generation Vera Rubin GPUs.”

On Wednesday, the Information reported that OpenAI expects revenue to soar to $125 billion in 2029, from $3.7 billion in 2024 as it sees the combined sales from agents and other new products surpassing its popular chatbot.

“OpenAI's internal projections, as reported by the Information, should ease concerns around the monetization of AI-infrastructure spending,” Bloomberg Intelligence analysts Kunjan Sobhani and Oscar Hernandez Tejada wrote in a note. “As a major Nvidia customer, both directly and indirectly via Microsoft and CoreWeave, OpenAI's robust growth trajectory points to sustained demand for AI accelerators and justifies elevated capital spending across the ecosystem.”

News of continued demand from Nvidia’s customers eased worries of potential pullback on spending on artificial intelligence infrastructure from hyperscalers including Google, Amazon and Microsoft.

Nvidia has tumbled more than 17% so far this year amid concerns that economic uncertainty fueled by tariffs could prompt companies to pare their expenditures in AI build-out. Stricter restrictions on chip shipments to China also added to a mountain of worries that weighed down on the biggest player in AI chips. 

In mid-April, Nvidia told the Securities and Exchange Commission that it expects charges of as much as $5.5 billion related to its H20 products, after the Trump administration imposed a new license requirement for export of certain semiconductor products to China.

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