NVIDIA Reports 69% Revenue Growth to $44.1 Billion in Q1 Fiscal 2026

NVIDIA Corporation reported significant financial growth in its first quarter of fiscal year 2026, with total revenue reaching $44.1 billion, a 69% increase compared to $26.0 billion in the same period last year. Sequentially, revenue rose by 12% from $39.3 billion in the previous quarter. The company's net income for the quarter was $18.8 billion, translating to a diluted earnings per share of $0.76, up from $0.60 a year earlier. However, net income decreased by 15% from $22.1 billion in the prior quarter, primarily due to a $4.5 billion charge related to excess inventory and purchase obligations for its H20 products.

The substantial revenue growth was driven by NVIDIA's Compute & Networking segment, which generated $39.6 billion, a 75% increase year-over-year. This growth was fueled by heightened demand for accelerated computing platforms, particularly in AI applications. The Data Center revenue alone surged to $39.1 billion, up 73% from the previous year, while gaming revenue increased by 42% year-over-year, reflecting strong sales of the new Blackwell architecture. Despite these gains, the gross margin fell to 60.5% from 78.4% a year ago, largely due to the aforementioned inventory charge and the initial ramp-up of more complex systems.

In terms of operational developments, NVIDIA's employee headcount has increased, contributing to a 44% rise in operating expenses year-over-year, which totaled $5.0 billion. This increase was driven by higher compensation and benefits expenses, as well as costs associated with new product introductions. The company also reported a significant increase in cash and cash equivalents, which rose to $15.2 billion from $8.6 billion at the end of the previous quarter, bolstered by strong cash flow from operations amounting to $27.4 billion.

Geographically, NVIDIA's revenue was diversified, with 53% of total revenue coming from international markets. The United States accounted for $20.7 billion, while significant contributions also came from Singapore and Taiwan, reflecting the company's global reach. The filing noted that sales to two direct customers represented 30% of total revenue, highlighting a concentration risk in its customer base.

Looking ahead, NVIDIA faces challenges due to new U.S. export licensing requirements for its H20 products, which could impact future revenue streams, particularly in the Chinese market. The company is actively evaluating options to comply with these regulations while continuing to innovate in its product offerings. Despite these hurdles, NVIDIA remains optimistic about its growth trajectory, particularly in the AI sector, and plans to enhance its U.S.-based manufacturing capabilities to support future demand.