High stakes following a blockbuster quarter — With bumps along the way
NVIDIA will report its fiscal second-quarter (Q2 FY2026) results after the market closes on Wednesday, August 27, at 10:00 p.m. BST (5:00 p.m. ET). Wall Street is expecting another blowout revenue report, cooled by export curbs, fluctuating margins, and stratospheric expectations.
The chipmaker had scorching numbers in Q1, fueled by uninhibited demand for AI hardware. A $4.5 billion cost related to U.S. requirements to license H20 AI chips sold to China, however, reduced gross margins to 60.5%, below the target of 70%. Margins are expected to recover to around 72% with sales normalizing, now forecast by analysts.
Analysts set sights on $45.8 billion sales — and slower growth
Consensus estimates put Q2 revenue at $45.8 billion, up 52% from last year but decelerating from the breakneck paces of previous quarters. Internal guidance for the company ranges from $44.1 to $45.9 billion.
Net income will be $23.2 billion, a near 40% year-over-year increase. Revenue from its data center business — more than 80% of the company’s now — will jump 54%, from Q1’s record 73% year-over-year increase. While its automotive and robotics segment is gaining traction, with an 80% growth projection on the back of its DRIVE platform, Isaac robotics foundation model, and new autonomous vehicle safety modules.
AI demand continues red-hot — Blackwell chips pre-sold
NVIDIA’s technology leadership is not just unrivaled in the midst of regulatory headwinds. Its Blackwell chips, supporting the most demanding AI workloads, are pre-sold months ahead of production. Blackwell Ultra GPUs arrive later this year, and next-generation Rubin architecture arrives in 2026, with Rubin Ultra superchips arriving in 2027.
NVIDIA is packaging its “AI Factory” concept — integrated systems that turn raw data into intelligence — and selling it to businesses and governments around the world. The factories are built from NVIDIA’s blueprints, networking software, and hardware, turning the company into a full-stack AI provider rather than just a chipmaker.
Big Partnerships, Bigger Ecosystem
Strategic alliances are driving the growth of NVIDIA. Taiwan’s government and Foxconn are building a factory that will make supercomputers using 10,000 Blackwell GPUs. Saudi Arabia’s Humain project bought 18,000 GB300 Blackwell chips. In healthcare, partnerships with IQVIA, Illumina, and Mayo Clinic are driving drug discovery and genomic research. And in transportation, Toyota and Aurora will use NVIDIA’s autonomous vehicle platform in future cars.
The deals underscore how deeply NVIDIA is moving into sectors, cementing its dominance in accelerated computing and AI.
Revenue-sharing pact eases China fears
NVIDIA and rival AMD came to terms with Washington in August to resume exporting some AI chips to China under new export controls. The companies will pay the U.S. government 15% of revenue from such exports in exchange for licenses.
China contributed to around 13% of the revenue of NVIDIA in FY2025, but experts speculate the actual percentage is greater because of indirect shipments. In case restrictions are eased, China sales could double, contributing an excess of 10% to the overall revenue even after the government tax cuts around 3%.
Stock on edge ahead of results
NVIDIA shares have been flying high in 2025, outperforming over double the April lows. Yet, after spiking to about $184, shares have lost steam. Recently, the stock dipped below its 20-day moving average and could test $165 support if the report disappoints. Strong earnings, meanwhile, could spark a break above $184, with $196 resistance on its radar.
What to watch on Wednesday
Investors will be paying attention to four questions:
- Can NVIDIA hit or exceed its $45.8 billion revenue target?
- Will gross margins revert to the mid-70% range?
- How much will China sales rebound under the new revenue-sharing agreement?
- Does Blackwell and future Rubin chip demand justify the premium valuation — now 33 times forward earnings?
With 58 of 65 analysts suggesting the stock as a “strong buy” or “buy” and a $191 average price target, NVIDIA is Wall Street’s top AI. But with expansion slowing and geopolitical tensions escalating, Wednesday’s numbers will show whether the company can keep surprising the market — in a good way.
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