NVDA -- FQ1 FY2027 Earnings Review

Most Recent Quarter: FQ1 FY2027 (ended April 26, 2026, reported May 20, 2026)

Verdict: Extraordinary print. Revenue accelerated for the 4th consecutive quarter to +85.2% YoY -- highest growth rate on a record base. DC +92%, DC Networking nearly tripled YoY. Q2 guide of $91B is roughly $6-8B above pre-print Street, effectively raising the entire forward curve. Capital return reset: $80B incremental buyback authorization plus a 25x dividend hike ($0.01 -> $0.25). Jensen: "Demand has gone parabolic. Agentic AI has arrived."

Capital Return Reset (announced May 18, 2026): NVDA returned a record $20B in Q1. Board authorized $80B incremental buyback (atop $38.5B remaining) and raised the quarterly dividend from $0.01 to $0.25 per share -- a 25x increase. Plan to return roughly 50% of FCF to shareholders this year. The dividend signal is meaningful: NVDA has materially shifted from growth-only capital allocation to a hybrid that includes durable income.

Notes: (1) Edge Computing = new market platform combining Gaming + Pro Visualization + Automotive + OEM in the Q1 FY27 reporting framework. Prior period values shown are the historical sum of those sub-segments for comparability. (2) ^FQ1 FY2025 EPS reflects a pre-10:1 split share count; post-split adjusted figures would be approximately $0.60 GAAP and $0.61 Non-GAAP. (3) *FQ4 FY2026 Non-GAAP EPS originally reported as $1.62 has been restated to $1.59 under the new Non-GAAP framework (effective Q1 FY27) that no longer excludes stock-based compensation. The $1.62 shown here is on the original (excl. SBC) basis to preserve cross-quarter comparability for the trend. Q1 FY27 $1.87 is on the new (incl. SBC) basis. (4) China Revenue is reported geographic (includes Hong Kong). H20 China DC compute revenue is zero in FY27 guidance; H200 China licenses approved but no revenue yet.

Note on EPS comparisons: NVIDIA completed a 10:1 stock split in June 2024. FY2022-FY2024 EPS figures are on a pre-split basis. FY2025 and FY2026 are on a post-split basis. Comparing FY2025 post-split Non-GAAP EPS of $2.99 to FY2024 pre-split $12.96 requires adjusting FY2024 to ~$1.30 post-split, yielding +130% YoY growth for FY2025.

The only EPS miss in the last 8 quarters was FQ1 FY2026, driven by a one-time $4.5B H20 inventory write-down -- not an operational miss. Excluding that charge, the underlying EPS beat rate would be 8/8 = 100%. L4Q EPS beat rate is now 100% with beat magnitudes consistently in the +4-7% range.

The $91B Q2 guide was the second major upside surprise of the print. Pre-report Street expectations for FQ2 FY2027 were in the $83-85B range. The $91B midpoint implies +11.5% sequential growth and +56.8% YoY. Notable: no China DC compute revenue is assumed in the guide -- pure organic upside if H200 ships materialize. Implied FY27 revenue trajectory now points to roughly $360-400B for the full year, vs. consensus that was anchored closer to $320-340B.

• Q2 FY27 revenue expected $91B +/- 2%; sequential growth driven primarily by Data Center.
• Continuing to "work vigorously on supply chain ecosystem to address the incredible demand we see ahead of us."
• "Full confidence in $1 trillion in Blackwell and Rubin revenue from CY2025 through CY2027." (Reaffirmed.)
• Q2 GAAP/Non-GAAP gross margins 74.9% / 75.0% +/- 50 bps. Full year mid-70s reiterated.
• Q2 GAAP/Non-GAAP OpEx ~$8.5B / $8.3B. Full year OpEx to grow upper 40% YoY (faster than prior).
• FY27 GAAP/Non-GAAP tax rate now 16-18% (was 17-19%) -- favorable geographic mix.
• Total supply now $145B (inventory + purchase commitments + prepaids).
• "Not including any China data center compute revenue in our outlook" -- consistent with last quarter.

• "Demand has gone parabolic" (Jensen): Most aggressive tone in 4+ quarters. 14th straight quarter of sequential growth.
• Hyperscale CapEx framework upgraded: "$700B approaching" → "now forecast to exceed $1 TRILLION by 2027." Material upward revision.
• NEW Vera CPU TAM ($200B): Standalone Vera CPU presented as incremental growth driver. $20B revenue visibility in FY27. Goal to become world's leading CPU supplier.
• Anthropic now strategic partner: "Largely zero" coverage previously -- now expanding via AWS, Azure, CoreWeave, xAI. NVDA's share of frontier AI compute growing.
• Segmentation overhaul: 2 platforms (Data Center, Edge Computing) and within DC 2 sub-markets (Hyperscale, ACIE). Designed to spotlight ACIE which grew 31% QoQ vs Hyperscale 12% QoQ.
• Capital return shift: 50% of FCF to shareholders this year. $80B buyback + 25x dividend hike. First explicit capital return framework.
• Vera Rubin on track: Q3 FY27 initial production shipments, Q4 ramp. POs in from "almost all major customers."
• China stable: H200 licenses approved but no revenue. No competitor commentary this quarter (tone softened vs Q4 FY26).
• Non-GAAP framework change: SBC now INCLUDED. Historicals restated. Q4 FY26 Non-GAAP EPS restated $1.62 → $1.59.

After five quarters of decelerating YoY revenue growth (from +262% down to +56% trough in Q2 FY26), NVIDIA has now re-accelerated for 4 consecutive quarters off an ever-larger revenue base:

• FQ3 FY2026: +62.5% YoY (vs. +55.6% prior) -- +690 bps acceleration
• FQ4 FY2026: +73.2% YoY (vs. +62.5% prior) -- +1,070 bps acceleration
• FQ1 FY2027: +85.2% YoY (vs. +73.2% prior) -- +1,200 bps acceleration

This is highly unusual. Most large-cap companies see growth rates compress as the base expands. NVIDIA's revenue base has grown from $46.7B (Q2 FY26 trough) to $81.6B (Q1 FY27) -- and YoY growth has expanded from +56% to +85% over the same span.

1. Blackwell scale + GB300 NVL72: Hundreds of thousands of Blackwell GPUs deployed cumulatively at frontier model builders and hyperscalers. GB300 the fastest product ramp in NVIDIA history.
2. Networking explosion: DC Networking $14.8B in Q1 FY27 -- up 199% YoY and now 20% of DC revenue (vs. ~11% pre-Blackwell-scale-up).
3. ACIE (non-hyperscale) accelerating faster than hyperscale: ACIE grew 31% QoQ vs. Hyperscale 12% QoQ. AI cloud revenue tripled YoY. Sovereign AI +80% YoY.
4. Anthropic strategic add: New major customer expanding capacity across multiple clouds.
5. Sequential adds at record: +$13.5B QoQ -- a record sequential revenue increase.

Forward trajectory: Q2 FY27 guide of $91B implies +56.8% YoY (decel from Q1's +85% as comp toughens), but ABSOLUTE sequential dollars continue to expand. With Vera Rubin shipments starting Q3 FY27 (Aug-Oct 2026) and ramping into Q4, FY27 revenue should land in the $360-400B range vs. pre-print Street ~$320-340B. $1 trillion in Blackwell+Rubin through CY2027 was reaffirmed with Vera/LPX positioned as incremental upside.

Short call -- only 8 questions taken vs typical 12. No deflections. Q&A heavily focused on segmentation, Vera CPU economics, and Vera Rubin ramp slope. Notable: Jensen corrected Colette's verbal dividend stumble live ("$0.20 -> $0.25") -- a humanizing moment showing prepared remarks scripted vs Q&A spontaneity.

No material factual contradictions across the four transcripts reviewed (Q2-Q4 FY26, Q1 FY27). The hyperscale CapEx framework, share of frontier AI, and capital return philosophy all evolved upward this quarter -- changes that reflect a strengthening narrative rather than retrenchment. The live dividend correction ($0.20 vs $0.25) is the only verbal slip; the press release confirms $0.25.

Positive read-throughs for ecosystem partners: Marvell (NVLink Fusion expansion), Coherent/Corning/Lumentum (optics multi-year deals), Cadence/Synopsys/Adobe (CUDA tool acceleration), Uber (robotaxi 30 cities), Hyundai/Kia/BYD/Geely/Isuzu/Nissan (DRIVE Hyperion).

Negative/dismissive on ASICs: Jensen's commentary about AI native clouds being unable to build chips or assemble unrelated parts is implicitly negative for ASIC merchant silicon (Broadcom's AI position). LPX positioned explicitly as niche.

Hyperscaler read-through (positive): AWS adding 1M+ Blackwell/Rubin GPUs, Microsoft Farweave live ahead of schedule, Google XGS as Vera Rubin early adopter. Hyperscaler CapEx to exceed $1T by 2027 (vs. ~$700B prior framework) implies higher CapEx intensity for AMZN, MSFT, GOOGL, META.