Nvidia reported fiscal second-quarter revenue of $96.2 billion, exceeding estimates by $4.3 billion and marking its 15th consecutive quarter of earnings beats. Earnings per share reached $2.22, a 6.7% surprise versus expectations.
Data center revenue totaled $89 billion, up 117% from a year earlier and accounting for 92.7% of total sales. Gross margins remained at 75% in the quarter, while the company returned a record $26 billion to shareholders through $20 billion in buybacks and $6 billion in dividends, representing 60% of free cash flow.
For the fiscal year ending January 2028, Nvidia guided for revenue growth of approximately 70%, nearly double the 45% increase forecast by Wall Street. The company projected third-quarter revenue of $108 billion, compared with a $104 billion consensus. Gross margins are expected to decline to about 74% in Q3, 71–72% in Q4, and stabilize at 72–73% for FY2028.
Analysts have raised price targets following the results. Raymond James set a new target of $515, while RBC Capital lifted its forecast to $330. Nvidia’s shares rose 9.7% to $229.96 in after-hours trading.
The company highlighted progress on its next-generation Vera Rubin GPU platform, slated for Q3 deliveries with expected contributions of roughly 20% of data center revenue in the current quarter. Vera CPU production has entered full scale, and AWS committed to deploying 2 million additional GPUs, including Vera CPUs, through Q2 FY2029.
Nvidia is investing nearly $50 billion in Frontier AI labs and partnering to raise over $500 billion in third-party capital. Sovereign AI revenue grew 35% quarter-over-quarter and tripled year-over-year, with NeoCloud targeting 8 gigawatts by year-end.
Hyperscaler cloud backlogs exceed $2 trillion, with top players projected to spend $1.3 trillion in capital expenditures by 2027. However, supply constraints, particularly in memory, remain a binding constraint on demand fulfillment. Long-term competition from custom ASIC chips developed by hyperscalers and geopolitical risks tied to U.S. investigations into suspected chip smuggling to China also pose challenges.
Nvidia’s market capitalization stands at $5.06 trillion, trading at roughly 25 times forward earnings based on consensus projections.
