NVIDIA (NASDAQ:NVDA) Announces Quarterly Earnings Results, Beats Estimates By $0.13 EPS

NVIDIA (NASDAQ:NVDA) issued its earnings results on Wednesday. The computer hardware maker reported $2.22 EPS for the quarter, topping the consensus estimate of $2.09 by $0.13, Zacks reports. NVIDIA had a return on equity of 107.00% and a net margin of 63.66%.The firm had revenue of $96.22 billion during the quarter, compared to analysts’ expectations of $92.27 billion. During the same period last year, the business earned $1.05 earnings per share. NVIDIA’s quarterly revenue was up 105.9% compared to the same quarter last year.

Here are the key takeaways from NVIDIA’s conference call:

• Record results and strong outlook: Q2 revenue reached $96 billion, more than doubling year over year, while NVIDIA forecast approximately 70% revenue growth in fiscal 2028 and $108 billion in Q3 revenue. Management said demand is substantially higher than its supply-constrained outlook.
• AI infrastructure demand continues to broaden: Data center revenue grew 18% sequentially to $89 billion, with particularly strong growth from enterprise, sovereign, NeoCloud, and other ACIE customers. NVIDIA expects non-hyperscaler markets to represent roughly half of its data center business over time.
• Major product and customer expansions support growth: AWS plans to deploy an additional 2 million NVIDIA GPUs through fiscal 2029, while Vera Rubin production shipments have begun and are expected to ramp faster than any prior NVIDIA product. The company also expects CPU revenue to more than double in fiscal 2028.
• New financing and revenue models could expand the addressable market: NVIDIA is partnering with major infrastructure capital providers to raise more than $500 billion for AI infrastructure and may receive recurring revenue-sharing income from NeoCloud deployments in addition to hardware sales.
• Gross margins are expected to decline materially: Memory costs are rising sharply, leading NVIDIA to forecast Q3 gross margins of 74%, a Q4 trough of 71%–72%, and fiscal 2028 margins of 72%–73%. The company also said there is no China data center compute revenue in its forward outlook amid geopolitical uncertainty, while investments and credit support for AI labs introduce additional financial exposure.

NVIDIA Stock Up 8.7%

NVDA opened at $227.98 on Friday. The firm’s 50-day simple moving average is $207.95 and its 200-day simple moving average is $200.66. The company has a debt-to-equity ratio of 0.04, a quick ratio of 2.85 and a current ratio of 3.44. NVIDIA has a twelve month low of $164.07 and a twelve month high of $236.54. The firm has a market cap of $5.52 trillion, a price-to-earnings ratio of 28.82, a PEG ratio of 0.41 and a beta of 2.23.

NVIDIA Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, October 1st. Stockholders of record on Thursday, September 10th will be paid a $0.25 dividend. This represents a $1.00 annualized dividend and a dividend yield of 0.4%. The ex-dividend date is Thursday, September 10th. NVIDIA’s payout ratio is currently 15.31%.

Key NVIDIA News

Here are the key news stories impacting NVIDIA this week:

• Positive Sentiment: NVIDIA reported fiscal Q2 revenue of $96.2 billion, up 106% year over year, while Data Center revenue climbed 117% to $89.0 billion. Adjusted EPS of $2.22 also exceeded the $2.09 consensus estimate. NVIDIA Announces Financial Results for Second Quarter Fiscal 2027
• Positive Sentiment: Management forecast approximately $108 billion in fiscal Q3 revenue and about 70% revenue growth for fiscal 2028, well above prior market expectations. CEO Jensen Huang said AI infrastructure demand is accelerating and that the buildout is “at full steam.” Nvidia rises after signaling longer AI spending runway
• Positive Sentiment: The expanded AWS partnership, including an additional 2 million NVIDIA GPUs, supports the view that hyperscaler demand remains strong. Analysts responded with higher targets, including JPMorgan’s $320 target and RBC’s $330 target. Amazon just tripled its order of Nvidia chips
• Positive Sentiment: NVIDIA is expanding its ecosystem beyond GPUs through Vera Rubin CPUs, open-source AI tools, compute-financing partnerships and reported interest in Hugging Face. These initiatives could deepen customer reliance on its full-stack platform. Nvidia agrees to buy Hugging Face for $12.9 billion, report says
• Neutral Sentiment: Investors briefly took profits after the earnings-driven semiconductor rally, suggesting that exceptionally high expectations may produce near-term volatility even when results remain strong. Nvidia, AMD, Intel stocks slide premarket
• Negative Sentiment: Fiscal Q3 gross margin is expected to ease to about 74% from 75%, while memory, packaging and power shortages could constrain shipments and raise costs.
• Negative Sentiment: NVIDIA’s outlook assumes no China data-center compute revenue, and Washington may impose further restrictions. Support for Chinese open-source models could increase regulatory and geopolitical exposure. Nvidia is bolstering support for Chinese open AI models
• Negative Sentiment: The reported pause in some AI-cloud revenue-sharing and financing deals raises questions about customer credit risk, cash-flow quality and whether NVIDIA is subsidizing demand. Nvidia pauses revenue-sharing deals with AI cloud companies

NVIDIA announced that its Board of Directors has approved a stock buyback plan on Wednesday, May 20th that permits the company to repurchase $80.00 billion in outstanding shares. This repurchase authorization permits the computer hardware maker to buy up to 1.5% of its stock through open market purchases. Stock repurchase plans are generally a sign that the company’s board believes its shares are undervalued.

Insider Transactions at NVIDIA

In other NVIDIA news, Director Mark A. Stevens sold 885,000 shares of the company’s stock in a transaction dated Thursday, June 18th. The shares were sold at an average price of $210.17, for a total transaction of $186,000,450.00. Following the sale, the director directly owned 5,207,271 shares of the company’s stock, valued at approximately $1,094,412,146.07. This represents a 14.53% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, Director Stephen C. Neal sold 15,500 shares of the company’s stock in a transaction dated Wednesday, June 3rd. The stock was sold at an average price of $215.73, for a total transaction of $3,343,815.00. Following the sale, the director directly owned 116,135 shares in the company, valued at $25,053,803.55. This represents a 11.77% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 1,900,500 shares of company stock valued at $410,449,265 in the last quarter. 3.94% of the stock is currently owned by corporate insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently modified their holdings of NVDA. Longfellow Investment Management Co. LLC raised its position in NVIDIA by 47.9% in the 2nd quarter. Longfellow Investment Management Co. LLC now owns 207 shares of the computer hardware maker’s stock valued at $33,000 after purchasing an additional 67 shares during the last quarter. Spurstone Advisory Services LLC bought a new stake in shares of NVIDIA during the second quarter worth $40,000. Inspire Investing LLC bought a new stake in shares of NVIDIA during the fourth quarter worth $44,000. AlphaCentric Advisors LLC acquired a new stake in shares of NVIDIA in the fourth quarter valued at $45,000. Finally, EDENTREE ASSET MANAGEMENT Ltd acquired a new stake in shares of NVIDIA in the second quarter valued at $54,000. Institutional investors own 65.27% of the company’s stock.

Analyst Ratings Changes

A number of brokerages have recently issued reports on NVDA. Sanford C. Bernstein restated an “outperform” rating and issued a $400.00 price objective (up from $315.00) on shares of NVIDIA in a research note on Thursday. New Street Research decreased their target price on shares of NVIDIA from $343.00 to $340.00 in a research report on Thursday, May 21st. Zacks Research cut shares of NVIDIA from a “strong-buy” rating to a “hold” rating in a research note on Friday, August 21st. Citic Securities upped their target price on shares of NVIDIA from $242.00 to $315.00 and gave the company a “buy” rating in a research note on Friday, May 22nd. Finally, BNP Paribas Exane increased their price target on shares of NVIDIA from $270.00 to $285.00 and gave the stock an “outperform” rating in a research report on Thursday, May 21st. Two analysts have rated the stock with a Strong Buy rating, forty-eight have issued a Buy rating and four have given a Hold rating to the company’s stock. According to MarketBeat, NVIDIA currently has a consensus rating of “Moderate Buy” and an average target price of $322.61.

About NVIDIA

NVIDIA Corporation, founded in 1993 and headquartered in Santa Clara, California, is a global technology company that designs and develops graphics processing units (GPUs) and system-on-chip (SoC) technologies. Co-founded by Jensen Huang, who serves as president and chief executive officer, along with Chris Malachowsky and Curtis Priem, NVIDIA has grown from a graphics-focused chipmaker into a broad provider of accelerated computing hardware and software for multiple industries.

The company’s product portfolio spans discrete GPUs for gaming and professional visualization (marketed under the GeForce and NVIDIA RTX lines), high-performance data center accelerators used for AI training and inference (including widely adopted platforms such as the A100 and H100 series), and Tegra SoCs for automotive and edge applications.