Published: August 28, 2026 | Category: Markets
Nvidia is once again setting the pace for the AI trade, its shares climbing about 7% in premarket trading on Thursday after a quarter that even jaded investors struggled to fault. The chipmaker reported revenue of $96.2 billion for its fiscal second quarter, up 106% from a year earlier, and guided the current quarter to $108 billion, above what Wall Street had penciled in.
The quarter ended July 26, 2026. Data Center revenue did the heavy lifting at $89.0 billion, up 117% year over year and now roughly 93% of the company’s sales. GAAP net income reached $59.7 billion, up 126% from a year ago. Diluted earnings came to $2.46 a share on a GAAP basis. Gross margin held at 75.0%.
The guide moved the stock
Nvidia expects revenue of $108.0 billion, give or take 2%, for the fiscal third quarter. That outlook assumes no Data Center compute revenue from China, a reminder that management is steering around the export restrictions rather than betting on their reversal. Even without China, the implied sequential jump is more than $11 billion.
Margins carry one wrinkle. Nvidia expects gross margin to slip to 74.0%, plus or minus 50 basis points, in the current quarter, as memory prices climb faster than the company had modeled. Chief executive Jensen Huang and finance chief Colette Kress framed the squeeze as a symptom of the same demand surge driving the top line, not a drag on it. Tighter memory supply, on that logic, is evidence the buildout is real.
Nvidia is also handing cash back at a pace few peers can match. The company returned about $26.0 billion to shareholders during the quarter through buybacks and dividends, and still holds roughly $99.0 billion under its repurchase authorization. It will pay a quarterly dividend of $0.25 a share on October 1.
Still the barometer of the AI trade
The read-through for the wider market is the one it has been for two years. Nvidia’s results are the closest thing investors have to a live gauge of AI spending, and the gauge is still rising. “AI has reached its inflection point,” Huang said. “Now, compute is revenue.”
The open question is not whether Nvidia is making money. It plainly is. The question is whether the ecosystem it anchors, the hyperscalers, the frontier labs, and the sovereign projects buying its chips, can convert that spending into returns of their own. Until it does, each quarter like this one buys Nvidia another three months of the benefit of the doubt.