NVIDIA Corporation
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Item 1. Business
Our Company
NVIDIA pioneered accelerated computing to help solve the most challenging computational problems. NVIDIA is now a data center scale AI infrastructure company reshaping all industries.
Our technology stack includes the foundational NVIDIA CUDA development platform that runs on all NVIDIA GPUs, as well as hundreds of domain-specific software libraries, frameworks, algorithms, software development kits, or SDKs, and application programming interfaces, or APIs. This deep and broad software stack accelerates the performance and facilitates the deployment of NVIDIA accelerated computing for computationally intensive workloads such as artificial intelligence, or AI, model training and inference, data analytics, scientific computing, robotics, and 3D graphics, with vertical-specific optimizations to address industries ranging from healthcare and telecom to automotive and manufacturing.
Introduced with the Blackwell architecture, our data-center-scale offerings feature extreme co-design where the infrastructure’s chips, networking, systems, software, and algorithms are holistically architected and optimized to maximize performance and scale. Hundreds of thousands of GPUs can be interconnected to function as a single giant computer. This type of data center architecture and scale is needed for the development and deployment of modern AI and accelerated computing applications.
The GPU was initially used to simulate human imagination, enabling the virtual worlds of video games and films. Today, it also simulates human intelligence, enabling a deeper understanding of language, science, and the physical world. Its parallel processing capabilities, supported by tens of thousands of computing cores, are essential for deep learning algorithms. This form of AI, in which software writes itself by learning from large amounts of data, can serve as the brain of computers, robots, and self-driving cars that can perceive, understand and reason about the world. GPU-powered AI solutions are being developed by thousands of enterprises to deliver services and products that would have been immensely difficult or even impossible with traditional coding. Examples include generative AI, which can create new content such as text, code, images, audio, video, molecule structures, and recommendation systems; and agentic AI where systems of AI models work in concert to automatically complete a task.
NVIDIA has a platform strategy, bringing together hardware, systems, software, algorithms, libraries, AI models and training data sets, and services to create unique value for the markets we serve. While the computing requirements of these end markets are diverse, we address them with a unified underlying programmable architecture allowing us to support several multi-billion-dollar end markets with the same underlying technology by using a variety of software stacks developed either internally or by third-party developers and partners. The large and growing number of developers and installed base across our platforms strengthens our ecosystem and increases the value of our platform for our customers.
Innovation is at our core. We have invested over $76.7 billion in research and development since our inception, yielding inventions that are essential to modern computing. Our invention of the GPU in 1999 sparked the growth of the PC gaming market and redefined computer graphics. With our introduction of CUDA in 2006, we opened the parallel processing capabilities of our GPU to a broad range of compute-intensive applications, paving the way for the emergence of modern AI. In 2012, the AlexNet neural network, trained on NVIDIA GPUs, won the ImageNet computer image recognition competition, marking the “Big Bang” moment of AI. We introduced our first Tensor Core GPU in 2017, built from the ground-up for the new era of AI, and our first autonomous driving system-on-chips, or SoC, in 2018. Our acquisition of Mellanox in 2020 expanded our offerings to include networking, enabled our platforms to be data center scale, and led to the introduction of a new processor class – the data processing unit, or DPU. Over the past 5 years, we have built full software stacks that run on top of our GPUs and CUDA to bring AI to the world’s largest industries, including NVIDIA DRIVE stack for autonomous driving, Clara for healthcare, Omniverse for physical AI applications, and NVIDIA AI Enterprise software – essentially an operating system for enterprise AI applications. In 2023, we introduced our first data center CPU, Grace, built for giant-scale AI and high-performance computing, or HPC. In 2024, we launched the NVIDIA Blackwell architecture – connecting 36 Grace CPUs and 72 Blackwell GPUs in a data center scale, liquid-cooled design – for real-time trillion-parameter inference and training. In fiscal year 2026, we launched and scaled the NVIDIA Blackwell Ultra platform, optimized for agentic, reasoning, and physical AI. Building on the architectural breakthroughs of Blackwell and leveraging Dynamo inference software, it delivers a significant increase in token throughput and reduction in cost per token compared to the Hopper generation. More recently, in support of market development, we have accelerated the release cadence of our open AI model platforms including NVIDIA Nemotron for agentic AI and Cosmos for physical AI. With a strong engineering culture, we drive fast, yet harmonized, product and technology innovations in all dimensions of computing including silicon, systems, networking, software and algorithms. More than half of our engineers work on software.
All major cloud service providers, or CSPs, AI model makers, and enterprises use our data center-scale infrastructure and computing platforms to accelerate the services and offerings they deliver to billions of end users and customers, including AI solutions and assistants, AI foundation models, advertising, search, recommendation systems, social
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networking, data processing, online shopping, live video, and translation. AI model makers use our infrastructure and software hosted at CSPs to develop, build and run AI models, product offerings, and services.
Enterprises and startups across a broad range of industries use our accelerated computing platforms to build new generative and agentic AI-enabled products and services, and/or to dramatically accelerate and reduce the costs of their workloads and workflows. The enterprise software industry uses them for new AI assistants, chatbots, and agents; the transportation industry for autonomous driving; the healthcare industry for accelerated and computer-aided drug discovery; and the financial services industry for customer support and fraud detection.
Researchers and developers use our computing solutions to accelerate a wide range of important applications, from simulating molecular dynamics to climate forecasting. With support for 6,000 applications, NVIDIA computing enables some of the most promising areas of discovery, from climate prediction to materials science and from wind tunnel simulation to genomics. Including GPUs and networking, NVIDIA powers over 78% of the supercomputers on the global TOP500 list, including 9 of the top 10 systems on the Green500 list.
Gamers choose NVIDIA GPUs to enjoy immersive, increasingly cinematic virtual worlds. In addition to serving the growing number of gamers, the market for PC GPUs is expanding because of the growing population of live streamers, broadcasters, artists, and creators. With the advent of generative and agentic AI, we expect a broader set of PC users to choose NVIDIA GPUs for running these applications locally on their PC, which is critical for privacy, latency, and cost-sensitive AI applications.
Professional artists, architects and designers use NVIDIA partner products accelerated with our GPUs and software platform for a range of creative, engineering, and design use cases, such as creating visual effects in movies or designing buildings and products. In addition, generative and agentic AI is expanding the market for our workstation-class GPUs, as more enterprise customers develop and deploy AI applications with their data on-premises.
Headquartered in Santa Clara, California, NVIDIA was incorporated in California in April 1993 and reincorporated in Delaware in April 1998.
Our Businesses
We report our business results in two segments.
The Compute & Networking segment includes our Data Center accelerated computing and networking platforms and AI solutions and software, and Automotive platforms and autonomous and electric vehicle solutions including software.
The Graphics segment includes GeForce GPUs for gaming and PCs, and Quadro/NVIDIA RTX GPUs for enterprise workstation graphics.
Our Markets
We specialize in markets where our computing and AI infrastructure platforms can provide tremendous acceleration for applications. These platforms incorporate processors, interconnects, software, algorithms, systems, and services to deliver unique value. Our platforms address four large markets where our expertise is critical: Data Center, Gaming, Professional Visualization, and Automotive.
Data Center
The NVIDIA Data Center platform is focused on accelerating compute-intensive workloads, such as AI, data processing, graphics, robotics, and scientific computing, delivering superior total cost of ownership relative to conventional CPU-only approaches. It is deployed in cloud, hyperscale, on-premises and edge data centers. The platform consists of data center compute and networking infrastructure offerings typically delivered to customers as rack-scale systems, subsystems, or modules, along with software and services.
Our Data Center infrastructure systems include supercomputing platforms and servers, bringing together our higher performance, energy efficient GPUs, CPUs, interconnects, and fully optimized AI and HPC software stacks. In addition, they include a growing body of acceleration libraries, AI models and training data sets, APIs, SDKs, and domain-specific application frameworks.
Our networking offerings include NVLink interconnects and switches, end-to-end platforms for InfiniBand and Ethernet, consisting of network adapters, cables, DPUs, switch chips and systems, as well as software. This has enabled us to architect data center-scale computing platforms that can interconnect up to hundreds of thousands of compute nodes with high-performance networking. Fueled by an expansion in AI and HPC workloads, the data center has become the new unit of computing, with networking as an integral part. In fiscal year 2026, we introduced NVIDIA NVLink Fusion to enable hyperscalers and custom ASIC designers to integrate custom CPUs and XPUs with our platform.
Our customers include all major public and private cloud providers, AI model makers, enterprises and startups, and public sector entities. We work with industry leaders to help build or transform their applications and data center infrastructure. Some of our direct customers include original equipment manufacturers, or OEMs, original device manufacturers, or
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ODMs, system integrators and distributors which we partner with to help bring our products to market. We also have partnerships in automotive, healthcare, financial services, manufacturing, retail, and technology among others, to accelerate the adoption of AI.
At the foundation of the NVIDIA accelerated computing platform are our GPUs, which excel at parallel workloads such as the training and inferencing of neural networks. These Data Center systems are extreme co-designed with the GPU, CPU, NVLink switch, DPU, NIC, and scale-out networking along with software stacks and algorithms to deliver data center-scale computing solutions.
While our approach starts with powerful chips, what makes it a full-stack computing platform is our large body of software, including the CUDA development platform, the CUDA-X collection of acceleration libraries, AI models and training data sets, APIs, SDKs, and domain-specific application frameworks.
In addition to software delivered to customers as an integral part of our data center computing and networking platform, we offer paid licenses to NVIDIA AI Enterprise, a comprehensive suite of enterprise-grade AI software and NVIDIA vGPU software for graphics-rich virtual desktops and workstations.
In fiscal year 2025, we launched the NVIDIA Blackwell architecture, a full set of data center scale infrastructure that includes GPUs, CPUs, DPUs, interconnects, switch chips and systems, and networking adapters. Blackwell excels at processing cutting edge generative AI and accelerated computing workloads with market leading performance and efficiency. Offered in a number of configurations, for customers across industries and a diverse set of AI and accelerated computing use cases. In fiscal year 2026, we unveiled the NVIDIA Rubin platform, which is expected to commence production shipments in the second half of fiscal year 2027. Built for agentic AI and reasoning, it excels at processing multi-step problem-solving and massive long-context workflows, delivering up to a 10x reduction in cost per token compared to Blackwell.
For physical AI, we provide an end-to-end platform spanning data center infrastructure, open models, systems, embedded compute modules, and software stacks to train, simulate, and deploy advanced automation and robotics solutions.
Gaming
Gaming is the largest entertainment industry, with PC gaming as the predominant platform. Many factors propel its growth, including new high production value games, the continued rise of eSports, social connectivity and the increasing popularity of game streamers, modders, or gamers who remaster games, and creators.
Our products for the gaming market include GeForce RTX GPUs for gaming desktop and laptop PCs, GeForce NOW cloud gaming service, as well as SoCs and development services for game consoles.
Our gaming platforms leverage our GPUs and sophisticated software to enhance the gaming experience with smoother, higher quality graphics. NVIDIA RTX features ray tracing technology for real-time, cinematic-quality rendering, and deep learning super sampling, or NVIDIA DLSS, our AI technology that boosts frame rates while generating high-quality images for games. RTX GPUs also feature NVIDIA tensor core technology making them well suited to accelerate a new generation of on-device AI applications.
In fiscal year 2025, we announced the NVIDIA Blackwell GeForce RTX 50 Series family of desktop and laptop GPUs. The Blackwell architecture introduced neural graphics which combines AI models with traditional rendering to boost game performance, image quality, and interactivity, as well as the next generation of our DLSS technology powered by a new transformer model architecture. In fiscal year 2026, we launched and scaled Blackwell architecture for gaming and GeForce NOW.
Professional Visualization
We serve the Professional Visualization market by working closely with independent software vendors, or ISVs, to optimize their offerings for NVIDIA GPUs. Our GPU computing platform enhances productivity and introduces new capabilities for critical workflows in many fields, such as design, engineering, and digital content creation across a wide range of industry verticals. Additionally, the increasing number of generative and agentic AI applications is giving rise to the need for the enhanced AI and data processing capabilities of our RTX PRO GPUs.
Many leading 3D design and content creation applications developed by our ecosystem partners support RTX, allowing professionals to accelerate and transform their workflows with NVIDIA RTX PRO GPUs and software. As these applications increasingly integrate AI, these GPUs are used and leverage the same Tensor Core technology found in our Data Center solutions.
Automotive
Automotive is comprised of platform solutions for automated driving from the cloud to the car. Leveraging our technology leadership in AI and building on long-standing relationships across several hundred automotive ecosystem partners, we are delivering a full stack end-to-end solution for the AV market under the DRIVE Hyperion platform. This platform consists of development infrastructure, high-performance, energy efficient DRIVE AGX computing hardware
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running an in-vehicle operating system (DRIVE OS), a reference sensor set that supports full self-driving capability as well as an open, modular DRIVE software platform for autonomous driving, mapping, and parking services, and intelligent in-vehicle experiences.
Business Strategies
NVIDIA’s key strategies that shape our overall business approach include:
Advancing the NVIDIA accelerated computing platform. Our accelerated computing platform can solve complex problems in significantly less time and with lower power consumption than alternative computational approaches. It can help solve problems that were previously deemed unsolvable. We work to deliver continued performance leaps that outpace Moore’s Law by leveraging innovation across the architecture, chip design, system, interconnect, algorithm, and software layers. This full-stack innovation approach allows us to deliver order-of-magnitude performance advantages relative to legacy approaches in our target markets, which include Data Center, Gaming, Professional Visualization, and Automotive. While the computing requirements of these end markets are diverse, we address them with a unified underlying architecture leveraging our GPUs, CPUs, CUDA and networking technologies as the fundamental building blocks. The programmable nature of our architecture allows us to make leveraged investments in research and development: we can support several multi-billion-dollar end markets with shared underlying technology by using a variety of software stacks developed either internally or by third-party developers and partners. We utilize this platform approach in each of our target markets.
Extending our technology and platform leadership in AI. We provide a complete, end-to-end accelerated computing platform for AI, addressing both training and inferencing. This includes full-stack data center-scale compute and networking solutions across processing units, interconnects, systems, and software. Our compute solutions include all three major processing units in AI servers – GPUs, CPUs, and DPUs. GPUs are uniquely suited to AI, and we will continue to add AI-specific features to our GPU architecture to further extend our leadership position.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are subject to the “safe harbor” created by those sections based on management’s beliefs and assumptions and on information currently available to management. In some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “could,” “goal,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “project,” “predict,” “potential” and similar expressions intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance, time frames or achievements to be materially different from any future results, performance, time frames or achievements expressed or implied by the forward-looking statements. We discuss many of these risks, uncertainties and other factors in this Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the fiscal year ended January 25, 2026 in greater detail under the heading “Risk Factors” of such reports. Given these risks, uncertainties, and other factors, you should not place undue reliance on these forward-looking statements. Also, these forward-looking statements represent our estimates and assumptions only as of the date of this filing. You should read this Quarterly Report on Form 10-Q completely and understand that our actual future results may be materially different from what we expect. We hereby qualify our forward-looking statements by these cautionary statements. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
All references to “NVIDIA,” “we,” “us,” “our” or the “Company” mean NVIDIA Corporation and its subsidiaries.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the filing date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.
© 2026 NVIDIA Corporation. All rights reserved.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the risk factors set forth in Item 1A. “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended January 25, 2026 and Part II, Item 1A. “Risk Factors” of this Quarterly Report on Form 10-Q and our Condensed Consolidated Financial Statements and related Notes thereto, as well as other cautionary statements and risks described elsewhere in this Quarterly Report on Form 10-Q and our other filings with the SEC, before deciding to purchase, hold, or sell our securities.
Overview
Our Company and Our Businesses
NVIDIA pioneered accelerated computing to help solve the most challenging computational problems. Since our original focus on PC graphics, we have expanded to several other large and important computationally intensive fields. Fueled by the sustained demand for exceptional 3D graphics and the scale of the gaming market, NVIDIA has leveraged its GPU architecture to create platforms for scientific computing, AI, data science, autonomous vehicles, robotics, and digital twin applications. NVIDIA is now a data center-scale AI infrastructure company reshaping all industries.
Our two operating segments are “Compute & Networking” and “Graphics.” Refer to Note 13 of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.
Headquartered in Santa Clara, California, NVIDIA was incorporated in California in April 1993 and reincorporated in Delaware in April 1998.
Recent Developments, Future Objectives and Challenges
Revenue growth in the second quarter and the first half of fiscal year 2027 was driven by data center products for accelerated computing and AI solutions. Blackwell continued to account for the majority of our system shipments.
Our next-generation Data Center architecture, Vera Rubin, began production shipments in the third quarter of fiscal year 2027. We will be shipping both Blackwell and Rubin systems in the future and are currently experiencing certain supply constraints. Demand estimates for our products can be inaccurate and create volatility in our revenue or supply levels. To secure inventory and capacity to meet demand for the next several years, we have entered into significant commitments and may continue to enter into manufacturing and supply agreements for both current and future products, and we continue to expand our supplier base. The scale and size of our production needs and the complexity of producing our data center systems has caused and could in the future cause delays in production, challenges in managing supply and demand, revenue volatility, quality issues, increased inventory provisions, decreases in product yields, higher material
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costs, and increased warranty costs. We have significantly increased our supply and capacity commitments from $119 billion last quarter to $279 billion as of July 26, 2026 to meet future demand. Refer to Note 10 of the Notes to Condensed Consolidated Financial Statements included in Part 1, Item 1 of this Quarterly Report on Form 10-Q. Customers may postpone purchasing new architectures due to the lack of availability of data center infrastructure to deploy our products, constraints on capital to have sufficient funding to purchase our products, or may adopt new technologies more gradually than anticipated, affecting our revenue timing and supply chain expenses.
The availability of land, power, shell, and capital is crucial to support the buildout of a full data center inclusive of NVIDIA AI infrastructure by our customers and partners, and any shortage of these or other necessary resources could impact our future revenue and financial performance. Expanding land, power, shell, and energy needs to meet demand is a complex, multi-year process that involves significant regulatory, technical, and construction challenges. In addition, access to capital can be particularly constrained for less-capitalized companies, which may face difficulties securing financing for large-scale infrastructure projects. We believe AI clouds and AI model makers have significant demand for training and inference compute and currently lack the ability to secure long-term infrastructure contracts and investment-grade financing capacity to secure the AI infrastructure necessary to grow. These limitations could delay customer and partner deployments or reduce the scale of accelerated computing and AI adoption and may impact the growth of our revenue. We have undertaken initiatives to address these challenges including securing and providing guarantees of land, power, shell, and capacity of select data center infrastructure that customers require to deploy our products. We expect to focus our data center infrastructure initiatives on exceptional sites and apply the same discipline to these initiatives as we do to our supply-chain management by securing critical inputs when we have visibility into customer demand and when doing so enables long-term productive capacity. We expect our large cloud service provider customers and investment grade enterprises to continue to secure land, power, and shell commitments independently. Our land, power, and shell commitments and guarantees may impact our financial results and are dependent on the performance of our customers and partners.
In August 2026, we entered into guarantees with SB Energy Corp. to provide credit support on the land, power, and shell buildout at SB Energy’s PORTS Technology Campus in Pike County, Ohio, covering leases for approximately 4.25 gigawatts of IT load. The campus will exclusively host our compute under 20-year leases to OpenAI, subject to limited exceptions, with our obligation capped at $105 billion in the aggregate, subject to certain conditions including SB Energy, the lessor, satisfying applicable ready-for-service conditions. Each guarantee generally becomes effective upon commencement of the applicable lease, with corresponding guarantee amounts increasing as each of nine data centers is placed in service, which is expected to begin in fiscal year 2029. Our exposure declines as OpenAI fulfills its lease payments. Our guarantees are limited to defined portions of lease and power payments and not the full cost of the site or all of the tenant’s obligations. The guarantees terminate upon certain events, including OpenAI achieving a satisfactory credit rating or after each respective lease term has completed. We also hold an option, exercisable in our sole discretion, to provide additional credit support in phases for approximately 3.8 additional gigawatts as the site scales. Refer to Note 10 of the Notes to Condensed Consolidated Financial Statements in Part 1, Item 1 of this Quarterly Report on Form 10-Q.
We have made, and may continue to make, investments and commitments in our ecosystem to enhance our growth opportunities, cultivate our ecosystem, and strengthen our competitive position. These include equity investments of $99 billion and equity investment commitments of $25 billion as of July 26, 2026.
In the second quarter of fiscal year 2027, we introduced a new business model with certain select AI cloud partners, to enable broader access to our data center infrastructure products to serve AI startups, model builders, enterprises, research organizations, and sovereign customers. We believe these AI cloud partners have strong customer demand and robust sales pipelines but are constrained by the large-scale infrastructure that is required to meet that demand. Through this model, we expect our AI cloud partners will be able to deploy incremental NVIDIA AI infrastructure, enabling them to serve a broader set of customers and address expanding demand for AI compute. Under these agreements, AI clouds procure our data center infrastructure products and we commit to cloud service agreements, which the AI clouds can unilaterally stop providing to us and sell to third-party customers at more advantageous rates. Our commitments, which are typically six years in duration, totaled $36 billion as of July 26, 2026, and decrease as capacity is used by third-party customers or by us for our research and development efforts. If certain criteria are met, we will participate in revenue share generated by the AI clouds from third-party customers, which may contribute to revenue in the future. If market conditions change, it may negatively impact our financial results. Refer to Note 10 of the Notes to Condensed Consolidated Financial Statements in Part 1, Item 1 of this Quarterly Report on Form 10-Q.
In August 2026, we entered into memorandums of understanding with several large capital providers to establish independent financing platforms designed to mobilize more than $500 billion of third-party capital over time to support the deployment of AI infrastructure. These and other preliminary arrangements may not lead to definitive agreements. These arrangements are designed for our ecosystem partners and customers to build and gain access to AI infrastructure with the corresponding funding structures independently underwritten and provided by the capital providers. At our option, we may provide limited residual-value support for a portion of specific projects, subject to disciplined risk management and project-by-project evaluation.
Open-source foundation models are rapidly growing in popularity with developers worldwide. We believe the demand for open-source foundation models and applications promotes use of our products worldwide. If these models and
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applications are primarily deployed on competitors’ platforms, they could reduce demand for our offerings. Any regulatory control or other restriction that limits our ability to provide products and services that support third-party applications and models could have a material impact on our business, operating results, and financial condition.
The U.S. government, or USG, granted licenses that would allow us to ship small amounts of H200 products to specific China-based customers, but such sales were restricted by the PRC government, and we have been unable to sell all the products for which we have licenses. During the first half of fiscal year 2027, we incurred a $0.4 billion charge associated with H200 for excess inventory and purchase obligations, as the demand for H200 products diminished. After incurring that charge, we have made a fraction of the allowed shipments under the USG’s H200 licensing program. Those shipments account for less than 1% of Data Center revenue in our most recent quarter. The licenses require that the H200s go through an inspection process in the United States prior to any shipment to the customer. As a result, any H200s shipped under the new licensing program are subject to a 25% tariff upon importation into the United States. We have been unable to pass along any of the tariff to our customers, and do not anticipate doing so in the event we are able to sell licensed products into the China market.
Our global supply chain for networking products, including our Israel operations, with approximately 6,200 employees, supporting research and development, operations, and sales and marketing, has not been significantly impacted by the conflict in the Middle East. If the conflict escalates or extends, it could affect future product development, supply chain, and revenue, and create business uncertainty.
Macroeconomic factors, including tariffs, inflation, interest rate changes, capital market volatility, global supply chain constraints, and global economic and geopolitical developments and conflicts, have direct and indirect impacts on our results of operations, particularly demand for our products. While difficult to isolate and quantify, these macroeconomic factors impact our supply chain and manufacturing costs, employee wages, costs for capital equipment, the value of our investments, revenue, and competitive position. Our product and solution pricing generally does not fluctuate with short-term changes in our costs. Within our supply chain, we continuously manage product availability and costs with our vendors.
Refer to Part II, Item 1A, “Risk Factors” for a discussion of these factors and other risks.
Second Quarter of Fiscal Year 2027 Summary
| Three Months Ended | Quarter-over-Quarter Change | Year-over-Year Change | |||||||||||||||||||||||||
| Jul 26, 2026 | Apr 26, 2026 | Jul 27, 2025 | |||||||||||||||||||||||||
| ($ in millions, except per share data) | |||||||||||||||||||||||||||
| Revenue | $ | 96,221 | $ | 81,615 | $ | 46,743 | 18 | % | 106 | % | |||||||||||||||||
| Gross margin | 75.0 | % | 74.9 | % | 72.4 | % | 0.1 pts | 2.6 pts | |||||||||||||||||||
| Operating expenses | $ | 8,408 | $ | 7,621 | $ | 5,413 | 10 | % | 55 | % | |||||||||||||||||
| Operating income | $ | 63,734 | $ | 53,536 | $ | 28,440 | 19 | % | 124 | % | |||||||||||||||||
| Net income | $ | 59,688 | $ | 58,321 | $ | 26,422 | 2 | % | 126 | % | |||||||||||||||||
| Net income per diluted share | $ | 2.46 | $ | 2.39 | $ | 1.08 | 3 | % | 128 | % | |||||||||||||||||
We specialize in markets where our computing platforms can provide tremendous acceleration for applications. These platforms incorporate processors, interconnects, software, algorithms, systems, and services to deliver unique value. Our platforms address large markets where our expertise is critical: Data Center and Edge Computing.
| Three Months Ended | Quarter-over-Quarter Change | Year-over-Year Change | |||||||||||||||||||||||||
| Jul 26, 2026 | Apr 26, 2026 | Jul 27, 2025 | |||||||||||||||||||||||||
| ($ in millions) | |||||||||||||||||||||||||||
| Revenue by Market Platform (1) (2) | |||||||||||||||||||||||||||
| Data Center | $ | 89,023 | $ | 75,246 | $ | 41,096 | 18 | % | 117 | % | |||||||||||||||||
| Hyperscale | 48,710 | 43,050 | 24,168 | 13 | % | 102 | % | ||||||||||||||||||||
| AI Clouds, Industrial, & Enterprise | 40,313 | 32,196 | 16,928 | 25 | % | 138 | % | ||||||||||||||||||||
| Edge Computing | 7,198 | 6,369 | 5,647 | 13 | % | 27 | % | ||||||||||||||||||||
| Total revenue | $ | 96,221 | $ | 81,615 | $ | 46,743 | 18 | % | 106 | % | |||||||||||||||||
(1) In the first quarter of fiscal year 2027, we changed our presentation of revenue by market platform and the comparable periods have been recast.
(2) During the second quarter of fiscal year 2027, we reclassified a company from ACIE to Hyperscale due to a change in their business model and recast the prior period revenue associated with this company.
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Revenue was $96.2 billion, up 106% from a year ago and up 18% sequentially.
Data Center revenue was $89.0 billion, up 117% from a year ago and up 18% sequentially, driven by the ramp of our Blackwell Ultra infrastructure. Hyperscale revenue more than doubled from a year ago and increased 13% sequentially on the strength of Blackwell Ultra. ACIE revenue increased 138% from a year ago and 25% sequentially driven by end-demand from AI natives, enterprises, and sovereign customers, as well as hyperscalers utilizing AI clouds. Shipments of Data Center Hopper products to China during the second quarter of fiscal year 2027 were less than 1% of Data Center revenue.
Edge Computing revenue was $7.2 billion, up 27% from a year ago and up 13% sequentially. The increases were driven by strong sales of Blackwell workstations, partially offset by slower consumer PC sales that were tempered by elevated memory and systems prices.
Gross margin increased from a year ago on improved mix from Blackwell Ultra. Gross margin was approximately flat sequentially as our Blackwell architecture remains the vast majority of our revenue.
Operating expenses were up 55% from a year ago and up 10% sequentially. These increases were driven by higher compute infrastructure and compensation and benefits costs.
Financial Information by Business Segment and Geographic Data
Refer to Note 13 of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for disclosures regarding segment information.
Critical Accounting Policies and Estimates
Refer to Part II, Item 7, “Critical Accounting Policies and Estimates” of our Annual Report on Form 10-K for the fiscal year ended January 25, 2026. There have been no material changes to our Critical Accounting Policies and Estimates.
Results of Operations
The following table sets forth, for the periods indicated, certain items in our Condensed Consolidated Statements of Income expressed as a percentage of revenue.
| Three Months Ended | Six Months Ended | |||||||||||||||||||||
| Jul 26, 2026 | Jul 27, 2025 | Jul 26, 2026 | Jul 27, 2025 | |||||||||||||||||||
| Revenue | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||
| Cost of revenue | 25.0 | 27.6 | 25.0 | 33.4 | ||||||||||||||||||
| Gross profit | 75.0 | 72.4 | 75.0 | 66.6 | ||||||||||||||||||
| Operating expenses | ||||||||||||||||||||||
| Research and development | 7.4 | 9.2 | 7.5 | 9.1 | ||||||||||||||||||
| Sales, general and administrative | 1.4 | 2.4 | 1.5 | 2.4 | ||||||||||||||||||
| Total operating expenses | 8.8 | 11.6 | 9.0 | 11.5 | ||||||||||||||||||
| Operating income | 66.2 | 60.8 | 66.0 | 55.1 | ||||||||||||||||||
| Other income, net | 8.1 | 6.0 | 13.6 | 3.4 | ||||||||||||||||||
| Income before income tax | 74.3 | 66.8 | 79.6 | 58.5 | ||||||||||||||||||
| Income tax expense | 12.3 | 10.2 | 13.2 | 8.7 | ||||||||||||||||||
| Net income | 62.0 | % | 56.6 | % | 66.4 | % | 49.8 | % | ||||||||||||||
Revenue and Reportable Segments
Revenue by Reportable Segments
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| ($ in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
| Compute & Networking | $ | 88,299 | $ | 41,331 | $ | 46,968 | 114 | % | $ | 162,850 | $ | 80,920 | $ | 81,930 | 101 | % | |||||||||||||||||||||||||||||||
| Graphics | 7,922 | 5,412 | 2,510 | 46 | % | 14,987 | 9,885 | 5,102 | 52 | % | |||||||||||||||||||||||||||||||||||||
| Total | $ | 96,221 | $ | 46,743 | $ | 49,478 | 106 | % | $ | 177,837 | $ | 90,805 | $ | 87,032 | 96 | % | |||||||||||||||||||||||||||||||
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Operating Income by Reportable Segments
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| ($ in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
| Compute & Networking | $ | 62,696 | $ | 28,363 | $ | 34,333 | 121 | % | $ | 116,031 | $ | 50,417 | $ | 65,614 | 130 | % | |||||||||||||||||||||||||||||||
| Graphics | 3,899 | 2,242 | 1,657 | 74 | % | 6,840 | 3,882 | 2,958 | 76 | % | |||||||||||||||||||||||||||||||||||||
| Total | $ | 66,595 | $ | 30,605 | $ | 35,990 | 118 | % | $ | 122,871 | $ | 54,299 | $ | 68,572 | 126 | % | |||||||||||||||||||||||||||||||
Compute & Networking revenue – The year-over-year increase in the second quarter and first half of fiscal year 2027 was driven by the ramp of our Blackwell Ultra infrastructure.
Graphics revenue – The year-over-year increase in the second quarter and first half of fiscal year 2027 was driven by sales of our Blackwell architecture.
Reportable segment operating income – The year-over-year increase in Compute & Networking segment operating income in the second quarter of fiscal year 2027 was driven by the growth in revenue. The year-over-year increase in Compute & Networking segment operating income in the first half of fiscal year 2027 was driven by the growth in revenue and the non-recurrence of a $4.5 billion charge associated with H20 excess inventory and purchase obligations in the first quarter of fiscal year 2026. The year-over-year increase in Graphics segment operating income in the second quarter and first half of fiscal year 2027 was driven by the growth in revenue.
Concentration of Revenue
We refer to customers who purchase products directly from NVIDIA as direct customers, such as AIBs, distributors, ODMs, OEMs, CSPs, AI model makers, and system integrators. Certain direct customers may use either internal resources or third-party system integrators to complete their build. We refer to indirect customers as those who purchase products through our direct customers; indirect customers include CSPs, AI clouds, AI model makers, enterprises, and public sector entities. Our revenue is concentrated among a limited number of direct and indirect customers and this trend may continue.
Direct Customers – For the second quarter of fiscal year 2027, one direct customer represented 16% of total revenue, which was primarily attributable to the Compute & Networking segment. For the first half of fiscal year 2027, three direct customers represented 16%, 15%, and 13% of total revenue, all of which was primarily attributable to the Compute & Networking segment.
For the second quarter of fiscal year 2026, two direct customers represented 23% and 16% of total revenue, all of which was primarily attributable to the Compute & Networking segment. For the first half of fiscal year 2026, two direct customers represented 20% and 15% of total revenue, all of which was primarily attributable to the Compute & Networking segment.
Indirect Customers – Indirect customer revenue is an estimation based upon multiple factors including customer purchase order information, product specifications, internal sales data, and other sources. Indirect customers primarily purchase our products through system integrators and distributors.
We generate a significant amount of our revenue from a limited number of indirect customers, some individually representing 10% or more of our revenue. Certain companies purchase cloud and related services through various direct and indirect customers. We estimate that one AI research and deployment company contributed a meaningful amount of our revenue by purchasing cloud services from our customers in the second quarter and first half of fiscal year 2027.
Revenue by geographic region is designated based on the location of the headquarters of direct customers. The end customer and shipping location may be different from our direct customers’ headquarters location. Revenue from sales to customers headquartered outside of the United States accounted for 38% and 30% of total revenue for the second quarter and first half of fiscal year 2027, respectively, and 30% and 35% of total revenue for the second quarter and first half of fiscal year 2026, respectively.
Gross Profit and Gross Margin
Gross profit consists of total net revenue less cost of revenue. Cost of revenue consists primarily of the cost of semiconductors (including wafer fabrication, assembly, testing, and packaging), board and device costs, manufacturing support costs (including labor and overhead associated with such purchases), final test yield fallout, inventory and warranty provisions, memory and component costs, tariffs, and shipping costs. Cost of revenue also includes acquisition-related intangible amortization expense, IP-related costs, and stock-based compensation related to personnel associated with manufacturing operations.
29
Gross margin increased to 75.0% for the second quarter of fiscal year 2027 compared to 72.4% for the second quarter of fiscal year 2026, and 75.0% for the first half of fiscal year 2027 compared to 66.6% for the first half of fiscal year 2026 due to improved mix from Blackwell Ultra. Gross margin for the first half of fiscal year 2026 was also impacted by a $4.5 billion charge associated with H20 excess inventory and purchase obligations.
Provisions for inventory and excess inventory purchase obligations totaled $985 million and $2.1 billion for the second quarter and first half of fiscal year 2027, respectively. Sales of previously reserved inventory and settlements of excess inventory purchase obligations resulted in a provision release of $177 million and $280 million for the second quarter and first half of fiscal year 2027, respectively. The net effect on our gross margin was an unfavorable impact of 0.8% and 1.0% in the second quarter and first half of fiscal year 2027, respectively.
Provisions for inventory and excess inventory purchase obligations totaled $1.0 billion and $6.3 billion for the second quarter and first half of fiscal year 2026, respectively, including $4.5 billion associated with H20 excess inventory and purchase obligations for the first quarter of fiscal year 2026. Sales of previously reserved inventory and settlements of excess inventory purchase obligations resulted in a provision release of $501 million and $937 million for the second quarter and first half of fiscal year 2026, respectively. The net effect on our gross margin was an unfavorable impact of 1.1% and 5.9% in the second quarter and first half of fiscal year 2026, respectively.
Operating Expenses
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | Jul 26, 2026 | Jul 27, 2025 | $ Change | % Change | ||||||||||||||||||||||||||||||||||||||||
| ($ in millions) | |||||||||||||||||||||||||||||||||||||||||||||||
| Research and development | $ | 7,054 | $ | 4,291 | $ | 2,763 | 64 | % | $ | 13,375 | $ | 8,280 | $ | 5,095 | 62 | % | |||||||||||||||||||||||||||||||
| Sales, general and administrative | 1,354 | 1,122 | 232 | 21 | % | 2,654 | 2,163 | 491 | 23 | % | |||||||||||||||||||||||||||||||||||||
| Total operating expenses | $ | 8,408 | $ | 5,413 | $ | 2,995 | 55 | % | $ | 16,029 | $ | 10,443 | $ | 5,586 | 53 | % | |||||||||||||||||||||||||||||||
The increases in research and development expenses for the second quarter and first half of fiscal year 2027 were primarily driven by a 127% and 120% increase in compute infrastructure, respectively, and a 30% increase in each fiscal year 2027 period in compensation and benefits, including stock-based compensation, reflecting employee growth and compensation increases.
The increases in sales, general and administrative expenses for the second quarter and first half of fiscal year 2027 were primarily driven by compensation and benefits, including stock-based compensation, reflecting employee growth and compensation increases.
Other Income, Net
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||||||||||||||
| Jul 26, 2026 | Jul 27, 2025 | $ Change | Jul 26, 2026 | Jul 27, 2025 | $ Change | ||||||||||||||||||||||||||||||
| ($ in millions) | |||||||||||||||||||||||||||||||||||
| Interest income | $ | 496 | $ | 592 | $ | (96) | $ | 1,037 | $ | 1,108 | $ | (71) | |||||||||||||||||||||||
| Interest expense | (227) | (62) | (165) | (329) | (124) | (205) | |||||||||||||||||||||||||||||
| Gains from equity securities, net | 7,771 | 2,247 | 5,524 | 23,707 | 2,073 | 21,634 | |||||||||||||||||||||||||||||
| Other | (267) | (11) | (256) | (275) | (18) | (257) | |||||||||||||||||||||||||||||
| Other income, net | $ | 7,773 | $ | 2,766 | $ | 5,007 | $ | 24,140 | $ | 3,039 | $ | 21,101 | |||||||||||||||||||||||
Other income, net, primarily consists of realized or unrealized gains and losses from investments in non-marketable securities and publicly-held equity securities. Gains from equity securities, net, were primarily driven by unrealized gains in equity securities.
Refer to Notes 5 and 6 of the Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for additional information.
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Income Taxes
Income tax expense was $11.8 billion and $4.8 billion for the second quarter, and $23.4 billion and $7.9 billion for the first half, of fiscal years 2027 and 2026, respectively. Income tax as a percentage of income before income tax was 16.5% and 15.3% for the second quarter, and 16.5% and 14.9% for the first half, of fiscal years 2027 and 2026, respectively.
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-09-04 | STEVENS MARK A indirect | Director | Sell | -622,239 ×4 | $231.62 | -$144,122,944 |
| 2026-09-03 | STEVENS MARK A indirect | Director | Sell | -400,000 ×3 | $228.78 | -$91,513,923 |
| 2026-09-02 | STEVENS MARK A indirect | Director | Sell | -1,200,000 ×4 | $223.33 | -$268,001,520 |
| 2026-09-01 | STEVENS MARK A indirect | Director | Sell | -63,501 | $220.06 | -$13,973,960 |
| 2026-08-31 | STEVENS MARK A indirect | Director | Sell | -585,000 ×2 | $220.29 | -$128,868,190 |
| 2026-08-31 | Teter Timothy S. indirect | EVP, General Counsel and Sec | Sell | -30,000 ×3 | $217.88 | -$6,536,515 |
| 2026-06-18 | STEVENS MARK A indirect | Director | Sell | -885,000 ×2 | $210.17 | -$185,999,938 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-11-18 10-Q expected by 2026-12-01 (in 70 days)
- ~2027-02-24 10-K expected by 2027-04-10 (in 168 days)
- ~2027-05-19 10-Q expected by 2027-06-01 (in 252 days)
- ~2027-08-25 10-Q expected by 2027-09-07 (in 350 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-09-03 8-K Other Events
- 2026-08-26 8-K Earnings Release; Financial Statements and Exhibits
- 2026-08-26 10-Q Quarterly Report
- 2026-08-17 8-K Material Agreement Entered; Material Financial Obligation; Regulation FD Disclosure
- 2026-07-02 8-K Officer/Director Change
- 2026-06-18 8-K Other Events; Financial Statements and Exhibits
- 2026-06-17 424B5 Prospectus Supplement
- 2026-05-20 8-K Earnings Release; Financial Statements and Exhibits
- 2026-05-20 10-Q Quarterly Report
- 2026-05-12 DEF 14A Proxy Statement
- 2026-05-08 8-K Officer/Director Change
- 2026-04-27 8-K Officer/Director Change
- 2026-03-06 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-02-25 10-K Annual Report
- 2026-02-25 8-K Earnings Release; Financial Statements and Exhibits