Nvidia reported quarterly results that beat Wall Street forecasts. The company also gave revenue guidance that topped analyst expectations.
The stock rose 4% after the report. Investors reacted well to the strong outlook for next year.
Nvidia posted earnings per share of $2.22, above the $2.10 analysts expected. Revenue came in at $96.22 billion versus $92.17 billion forecast.
Net income more than doubled to $53.95 billion from $24.76 billion a year earlier. That works out to $2.22 per share.
Chief Financial Officer Colette Kress told analysts that Nvidia expects fiscal 2028 revenue growth of 70%. Analysts had only expected growth of 44%.
Data Center Sales Keep Climbing
Data center sales reached $89 billion in the quarter. That figure topped the $86.33 billion analysts had expected.
Data center sales now make up 92% of Nvidia's total revenue. Total revenue climbed 106% from the same period last year.
Hyperscaler customers, the largest cloud companies, brought in $48.7 billion in sales. That revenue more than doubled from a year ago.
Smaller data center customers, grouped under AI clouds, industrial and enterprise, brought in $40.3 billion. That group grew 138% from last year.
Amazon Deal and Rising Costs
Amazon Web Services agreed to buy 2 million GPUs from Nvidia. The deal also includes millions of CPUs, according to CEO Jensen Huang.
Huang said Amazon plans to use the chips for cloud computing and for robotics projects.
Nvidia's gross margin held at 75% for a second straight quarter. The company said margin will slip to 74% in the current quarter.
Rising memory prices are pushing costs higher across the industry. Nvidia said gross margin could fall to between 71% and 72% by the fourth quarter of fiscal 2027.
Nvidia also flagged debt as a risk factor in its quarterly filing for the first time. The company had $33.5 billion in senior notes outstanding as of July 26.
The filing showed $15 billion of debt due within one to five years. That is far higher than the $2.75 billion reported in the prior quarter.
Nvidia spent $26 billion on stock buybacks and dividends during the quarter. The company also plans to pay a 25 cent per share dividend.
Supply commitments more than doubled to $279 billion from $119 billion last quarter. Nvidia said the increase was tied mostly to memory purchases.
Nvidia's outlook for the current quarter calls for sales of $108 billion, plus or minus 2%. That guidance topped analyst estimates of $104.2 billion.
The company said its forecast does not include any data center sales to China. Sales to China made up less than 1% of data center revenue in the latest quarter.
