By Arsheeya Bajwa

Aug 27 (Reuters) - AI chipmaker Nvidia ( NVDA ), the

dominating force behind the rally in the S&P 500 index

since 2023, is set to report second-quarter earnings on

Wednesday after U.S. market close. Wall Street is holding its

breath, and will scour the company's commentary for signs of a

slowdown.

Here is what to watch out for when the world's most valuable

firm reports results:

1. While investors and analysts expect Nvidia ( NVDA ) to outperform

market

expectations on Wednesday, a key question is - by how much?

After quarters of blazing triple-digit growth in 2024, the pace

of Nvidia's ( NVDA ) revenue increases has slowed and the company is

beating Wall Street estimates by smaller and smaller margins.

For its second quarter ended July, the company is expected to

report second-quarter revenue rose 53.2% to $46.02 billion,

according to LSEG data, a far cry from the 122% growth rate it

reported in the same period a year earlier. Gross margin - still

eye-popping - is shrinking too.

2. Are concerns about the AI rally overblown? OpenAI CEO Sam

Altman

recently said investors were "overexcited about AI". Tech firms

including Meta and Microsoft ( MSFT ) - big buyers of

Nvidia's ( NVDA ) chips - are spending liberally on their AI plans, and

even if they are starting to see the green shoots of returns,

the same cannot be said about most other companies. Nvidia's ( NVDA )

commentary about demand will either put investors at ease or

prompt a selloff in AI-related shares.

3. Will China buy Nvidia ( NVDA ) chips? The chipmaker recently

agreed to

pay the U.S. federal government 15% of the sales it made in

China in exchange for export licenses. But Beijing has cautioned

domestic companies to limit purchases over security concerns.

Reports have emerged that Nvidia ( NVDA ) has told some suppliers to

suspend production of its China-special H20 chips. Commentary

from Nvidia's ( NVDA ) management on the potential for selling to China

will be important for gauging future demand.

4. The company's product roadmap to address the China market

is

key, after U.S. President Donald Trump indicated he might allow

Nvidia ( NVDA ) to sell a scaled-down version of its next-generation

advanced Blackwell chip to Beijing. Reuters has reported Nvidia ( NVDA )

is developing a new AI chip for China based on the Blackwell

architecture that will be more powerful than the H20 model it is

currently allowed to sell there.

5. Supply of Nvidia's ( NVDA ) latest chips has fallen short of

booming

demand. A production ramp-up of its top-of-the-line Blackwell

processors has proven to be challenging. Investors are watching

out for commentary on how Nvidia's ( NVDA ) supply chains are powering up

to deliver its sought-after processors.