Revenue Doubles Year-Over-Year, Profit Growth Even Faster
NVIDIA reported its fiscal 2027 second-quarter results for the period ended July 26, 2026: revenue of $96.221 billion, an increase of 18% sequentially and 106% year-over-year. Both GAAP and non-GAAP gross margins were 75.0%. GAAP diluted earnings per share were $2.46, and non-GAAP diluted earnings per share were $2.22.
On a GAAP basis, the company's operating income for the quarter was $63.734 billion, an increase of 124% year-over-year; net income was $59.688 billion, an increase of 126% year-over-year. On a non-GAAP basis, operating income was $63.956 billion, up 124% year-over-year; net income was $53.954 billion, up 118% year-over-year. This indicates that NVIDIA not only maintained rapid expansion but also preserved extremely high profitability while doubling its revenue scale.
Jensen Huang, founder and CEO of NVIDIA, stated that artificial intelligence has reached a tipping point, with AI now performing useful work, and the generated tokens delivering productivity and profits. "Today, compute is revenue." He noted that last year, construction was primarily driven by one lab, but now new AI labs, startups, multiple frontier model companies, open model ecosystems, and Physical AI are expanding simultaneously. Global AI infrastructure construction is in full swing.
Data Center Revenue Reaches $89.0 Billion
Second-quarter data center revenue was $89.0 billion, up 18% sequentially and 117% year-over-year, remaining the absolute core of the company's growth. NVIDIA stated that the Vera Rubin platform has entered full production, with racks already running at partners including CoreWeave, Google Cloud, Microsoft Azure, Oracle Cloud Infrastructure, and Nebius.
The company also announced the Vera CPU, Spectrum-6 switching system, Groq 3 LPX for interactive AI inference, and the DSX platform for designing, building, and operating large-scale AI factories. NVIDIA believes the competitive focus has shifted from single GPU performance to the synergy between CPUs, GPUs, networking, software, and entire systems.
Edge computing business revenue was $7.2 billion, up 13% sequentially and 27% year-over-year. This business encompasses gaming, automotive, robotics, and other end-compute needs.
Q3 Revenue Guidance Raised to $108 Billion
NVIDIA expects fiscal 2027 third-quarter revenue of $108.0 billion, plus or minus 2%. Both GAAP and non-GAAP gross margins are expected to be approximately 74.0%, plus or minus 0.5 percentage points. GAAP and non-GAAP operating expenses are expected to be approximately $9.2 billion and $9.0 billion, respectively. This guidance does not include any data center compute revenue from the Chinese market.
The company returned approximately $26.0 billion to shareholders in the second quarter through share repurchases and cash dividends, with about $99.0 billion remaining under its share repurchase authorization at quarter-end. The next quarterly cash dividend of $0.25 per share will be payable on October 1.
For the market, the current quarter's revenue and profit exceeded expectations, and the Q3 guidance also surpassed the analyst consensus of approximately $105.4 billion, providing direct support for the stock's after-hours strength. Subsequent risks are concentrated on two points: Q3 gross margin is expected to decrease from 75% to 74%, and the guidance excludes data center revenue from China. As long as data center orders and the Rubin production schedule remain unchanged, the results still support the AI compute theme. If supply bottlenecks, capital expenditure slowdowns, or consecutive gross margin declines occur, valuation volatility could significantly increase.
