NVIDIA Earnings Analysis: Revenue Doubles to $96.2 Billion as Data Center Reaches 92% of Sales, Quarterly Guidance Set at $108 Billion
SANTA CLARA — NVIDIA Corporation (NASDAQ: NVDA) is currently the world's largest listed company, with a market capitalization above $5 trillion, ahead of Apple in second place. Its most recent reported results are for the second quarter of fiscal 2027, the quarter ended July 26, 2026, released on August 26, 2026. This analysis is based on the earnings release and the CFO commentary furnished with the company's Form 8-K filing with the U.S. Securities and Exchange Commission (SEC).
Start with the headline ledger. Revenue was $96.221 billion, up 106% from a year ago and up 18% from the previous quarter, above the roughly $92 billion market consensus reported ahead of the release. GAAP net income was $59.688 billion, up 126% year on year, and GAAP diluted earnings per share were $2.46, up 128%. Non-GAAP net income was $53.954 billion, up 118%, and non-GAAP diluted EPS was $2.22, up 120%, above consensus of about $2.02. Gross margin was 75.0% on both a GAAP and a non-GAAP basis, up 2.6 points from a year ago.
The Data Center business now accounts for roughly nine-tenths of the company. Data Center revenue was a record $89.023 billion, up 117% from a year ago and 18% sequentially, or about 92% of total revenue, driven, the company said, by the ramp of Blackwell Ultra infrastructure. Within that total, Hyperscale customers contributed $48.710 billion, up 102% year on year, while SI Clouds, Industrial, and Enterprise (ACIE) contributed $40.313 billion, up 138% year on year and 25% sequentially — growing faster than the hyperscale business. The CFO commentary attributed ACIE demand to SI natives, enterprises and sovereign customers, as well as hyperscalers using SI clouds, a broader demand base than the handful of buyers that drove the first wave of the buildout. "AI has reached its inflection point. It's doing useful work. Its tokens are productive and profitable. Now, compute is revenue," founder and CEO Jensen Huang said in the release. Edge Computing revenue was $7.198 billion, up 27% year on year, as strong Blackwell workstation sales were partly offset by slower consumer PC sales. By reportable segment, Compute & Networking revenue was $88.299 billion, up 114%, and Graphics was $7.922 billion, up 46%.
One relationship in the release runs against the usual pattern: GAAP EPS ($2.46) came in above non-GAAP EPS ($2.22). The reason is that GAAP net income includes about $7.8 billion of net gains from equity securities, largely unrealized, which the non-GAAP figures exclude. The same item explains an apparent contradiction elsewhere in the release: GAAP operating income rose 19% sequentially to $63.734 billion, up 124% year on year, yet GAAP net income rose only 2% from the prior quarter, because the size of the equity-securities gain differed between the two quarters.
Guidance points to continued growth with a slightly lower margin. For the third quarter of fiscal 2027, NVIDIA guided revenue to $108.0 billion, plus or minus 2%, above the roughly $104 billion consensus reported at the time, while guiding GAAP and non-GAAP gross margins to 74.0%, plus or minus 50 basis points — about one point below the 75.0% just reported. The outlook assumes no Data Center compute revenue from China; shipments of Hopper products to China were less than 1% of Data Center revenue in the second quarter. Operating expenses for the third quarter are expected to be approximately $9.2 billion on a GAAP basis and $9.0 billion non-GAAP, with fiscal 2027 tax rates expected between 16% and 18%.
Cash flow is the third ledger that rewards a close read. Cash provided by operating activities was $24.1 billion, well below GAAP net income of $59.688 billion and down from $50.3 billion in the prior quarter. The CFO commentary lays out the path: the equity-securities gains are non-cash; working capital absorbed cash, with accounts receivable at $63.1 billion and days sales outstanding rising to 60 days from 45 days, which the company attributed to extended payment terms on large, multi-quarter agreements with certain investment-grade customers; and inventory rose to $31.6 billion from $25.8 billion as the company prepared for the Vera Rubin launch in the third quarter. NVIDIA also issued $25.0 billion of senior unsecured notes during the quarter for general corporate purposes. Cash, cash equivalents and marketable debt securities ended the quarter at $56.6 billion.
The clearest sign of how the company's role is changing sits in its commitments and guarantees. Supply and capacity commitments rose from $119 billion in the prior quarter to $279 billion, primarily related to the procurement of memory, and total future commitments across all categories reached $366 billion. NVIDIA also guarantees land, power and shell lease obligations for certain SI cloud partners, with maximum gross exposure of $108.5 billion. That total includes guarantees signed in August 2026, capped at $105 billion, supporting about 4.25 gigawatts of capacity at SB Energy's PORTS-Pike Technology Campus in Ohio, which will host NVIDIA infrastructure under 20-year leases to OpenAI; the company expects each generation of infrastructure deployed at the campus to comprise about 1.5 million GPUs, representing approximately $150 billion to $200 billion in NVIDIA revenue. Separately, the company announced strategic partnerships with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs and KKR to establish independent compute financing platforms intended to mobilize over $500 billion of third-party capital for the SI infrastructure buildout over time.
On shareholder returns, NVIDIA returned approximately $26.0 billion in the quarter through share repurchases and cash dividends, a quarterly record, and ended the period with approximately $99.0 billion remaining under its share repurchase authorization. Its quarterly cash dividend of $0.25 per share was paid on October 1, 2026, to shareholders of record on September 10, 2026.
Set against the industry backdrop, the report landed as global SI capital spending accelerates. Morgan Stanley has forecast global SI capital expenditure of $1.58 trillion in 2027, with NVIDIA capturing about $690 billion of it, as GSM reported earlier. On the earnings call, as reported by financial media, management also gave a preliminary outlook of roughly 70% revenue growth for fiscal 2028, describing the figure as constrained by supply and below what customers are asking for. The Vera Rubin platform, now in full production, is the product line built to carry the next phase of that demand.
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Source: GSM · America
Source: GSM · USA (original Chinese edition)
Photo: 英伟达（NVIDIA）公司标志。© NVIDIA Corporation，Apache License 2.0，经 Wikimedia Commons。 / NVIDIA corporate logo. © NVIDIA Corporation, Apache License 2.0, via Wikimedia Commons.
