Financial Trends -- 9/10
Near-textbook "10" financial-trend profile across all four scoring axes at once. Revenue YoY
re-accelerating off a massive base (+56% trough to +85% in FY27Q1) on the Blackwell ramp and a
tripling of Data Center Networking. Gross/operating margins recovered 1,400+bps off the one-time
H20 write-down trough back to the mid-70s. FCF positive and re-accelerating ($96.6B FY26; $48.6B
in FY27Q1 alone). Share count declining, debt flat-to-lower. Only marks against a perfect 10 are
the H20-driven margin trough and lumpy quarterly FCF. No penalty modifiers.
Weight: 25%
Gross Margin
74.9%
Recovered off H20 trough | Mid-70s
FCF (FY27Q1)
$48.6B
+86% YoY | Re-accelerating
Share Count
Declining
$80B buyback outpaces SBC | No dilution
Quarters labeled by NVDA fiscal quarter; fiscal leads calendar by ~1 year (e.g. FY27Q1 = calendar 2026Q1). Fiscal year ends late January.
Quarterly Revenue Trajectory ($M)
Revenue YoY re-accelerating off a high base: +56% trough (FY26Q2) back to +85% (FY27Q1).
After the natural law-of-large-numbers deceleration from +262%, YoY growth has re-accelerated four
straight quarters, driven by the Blackwell ramp and Data Center Networking inflecting (+199% YoY in
FY27Q1 to $14.8B). This satisfies the rubric's top condition — revenue YoY accelerating.
Margin Trajectory (Quarterly)
Margins compressed then expanded 1,400+bps.
GAAP gross margin bottomed at 60.5% in FY26Q1 on a ~$4.5B H20 inventory / purchase-obligation
write-down tied to the China export restriction. Since the trough, GAAP GM expanded +1,440bps
(60.5% to 74.9%) and op margin recovered from a 49.1% trough to 65.6%. On a clean (ex-H20) basis
margins never broke from the mid-70s -- the trough is geopolitical, not operational.
Annual Financial Summary (FY ends late January)
| Metric | FY22 | FY23 | FY24 | FY25 | FY26 |
|---|---|---|---|---|---|
| Total Revenue ($M) | $26,914M | $26,974M | $60,922M | $130,497M | $215,938M |
| Rev YoY | — | +0.2% | +126% | +114% | +65% |
| Diluted EPS ($) | $3.85† | $1.74† | $11.93† | $2.94 | $4.90 |
| GAAP Op. Margin | 37.3% | 15.7% | 54.1% | 62.4% | 60.4% |
| Net Income ($M) | $9,752M | $4,368M | $29,760M | $72,880M | $120,067M |
| Free Cash Flow ($M) | $8,049M | $3,750M | $26,947M | $60,724M | $96,575M |
| LT Debt ($M) | $10,946M | $9,703M | $8,459M | $8,463M | $7,469M |
† FY22/FY23/FY24 diluted EPS is pre 10:1 split; FY25 onward split-adjusted. Fiscal labels lead calendar by ~1 year.
Key trends
- Revenue compounding at an extraordinary rate: From $26.9B (FY22) to $215.9B (FY26), an ~8x expansion in four years, now re-accelerating to +85% YoY in FY27Q1 on the Blackwell ramp
- Margins recovered and expanding: GAAP op margin expanded ~2,300bps over five years (37.3% to 60.4%); gross margin back in the mid-70s after the one-time H20 trough
- FCF positive and re-accelerating: Annual FCF $8.0B to $96.6B; $48.6B in FY27Q1 alone (+86% YoY)
- Share count declining, debt lower: Implied diluted shares drift down (~24.9B to ~24.4B split-adjusted) as the $80B buyback outpaces SBC; LT debt fell from $10.9B to $7.5B -- a net-cash balance sheet
Segment Revenue — FY27Q1 ($M)
Compute/Networking splits shown are the most recent clean disclosed split (CY2025Q4); the FY27Q1 press release puts DC Compute at ~$60.4B and DC Networking at ~$14.8B. Either way, Data Center Compute alone is ~63-74% of the entire company.
Free Cash Flow — Quarterly ($M)
FCF positive every period and re-accelerating. Free cash flow
reached $48.6B in FY27Q1 alone (+86% YoY), and $96.6B for full-year FY26 (+59%). Quarterly FCF is
lumpy on working-capital and supply timing (FCF margin swings 29-59%), but the absolute generation
and the trend are unambiguous -- this is the FCF gate cleared decisively.
Share Count & Balance Sheet (Quarterly)
- Share count declining: Implied diluted shares drift from ~24.9B to ~24.4B (split-adjusted) as the $80B buyback authorization outpaces stock-based comp -- no dilution
- Net-cash balance sheet: LT debt fell from $8.46B to $7.47B; NVDA carries far more cash than debt
Blemishes -- Not Operational Deterioration
| Blemish | Detail | Penalty |
|---|---|---|
| H20 Gross-Margin Trough | GAAP GM bottomed at 60.5% in FY26Q1 on a ~$4.5B H20 inventory / purchase-obligation write-down tied to the China export restriction; recovered to the mid-70s within a quarter. On a clean (ex-H20) basis margins never broke. | None |
| Lumpy Quarterly FCF | FCF margin swings quarter-to-quarter (29-59%) on working-capital and supply timing. Absolute FCF is positive every period and re-accelerating; the lumpiness is timing, not deterioration. | None |
Both blemishes are presentational / quality-of-earnings, not directional.
The margin trough is a one-time geopolitical write-down, not eroding pricing; FCF lumpiness is
working-capital timing on a strongly positive and growing base. No penalty modifier applies -- FCF
is positive, there is no dilution, operating income rises alongside revenue, and debt is
flat-to-declining.
Score Rationale
Score of 9/10 reflects a near-textbook "10" profile across all four scoring axes at once. No penalty modifiers applied.
Supports 9/10:
- Revenue YoY re-accelerating off a massive base (+56% trough to +85% in FY27Q1) on Blackwell and a tripling of DC Networking (+199% YoY)
- Gross and operating margins recovered 1,400+bps off the one-time H20 trough back to the mid-70s GM / 65.6% op margin
- FCF positive and re-accelerating ($96.6B FY26; $48.6B in FY27Q1 alone, +86% YoY)
- Share count declining as the $80B buyback outpaces SBC; net-cash balance sheet with LT debt falling to $7.5B
- Operating income rose every quarter sequentially; debt flat-to-declining -- zero penalty modifiers
Held off a perfect 10 (no penalty):
- The GM trajectory required a temporary H20 write-down trough (China export overhang capped China revenue at $4.55B, -46% QoQ)
- FCF margin is lumpy quarter-to-quarter on working-capital and supply timing
Data sourced from Daloopa (company_id: 145). Fiscal year ends late January. Fiscal labels lead calendar by ~1 year. All financials in USD.