Nvidia has once again outrun expectations. The chipmaker reported revenue of $96.2 billion for the three months to July 26, up 18% from the previous quarter and 106% from a year earlier, and said it expects about $108 billion in the current quarter.
The headline numbers
- Revenue: $96.2 billion, a record.
- Data centre revenue: $89.0 billion, up 117% year on year. This is the business that sells AI processors and networking to cloud companies.
- Gross margin: 75.0%.
- Earnings per share: $2.46 on a GAAP basis and $2.22 adjusted.
- Next-quarter outlook: $108 billion, plus or minus 2%, excluding any data-centre chip sales to China.
Cash back to shareholders
Nvidia returned about $26 billion to shareholders during the quarter through buybacks and dividends, and still has roughly $99 billion left under its repurchase authorisation. The next quarterly dividend of 25 cents a share will be paid on October 1.
What is driving demand
Almost all of the growth comes from data centres. Big cloud providers, AI developers and an increasing number of governments are building computing capacity to train and run AI models, and Nvidia’s chips and networking gear remain the default choice. Chief executive Jensen Huang summed up the mood in the results statement: “AI has reached its inflection point.”
The forecast excludes China, where export controls have limited what Nvidia can sell. Any return to that market would be upside the company is not counting on.
The questions investors are asking
At this scale, investors focus less on whether Nvidia will grow and more on how long the spending can last. Much of the AI build-out is now being financed with debt as well as cash flow, and a handful of customers account for a large share of sales. Rivals’ in-house chips are also maturing. For now, though, Nvidia’s guidance suggests orders are still rising faster than its suppliers can build.