The latest earnings from Nvidia Corp. were strong by almost every traditional metric. Revenue beat estimates. Profit topped expectations. Guidance came in ahead of Wall Street projections.
And yet, the stock barely moved.
That reaction tells you where the market’s head is right now.
Investors are no longer asking whether Nvidia is growing. They are asking whether this pace of growth can realistically continue in an AI economy that many believe is overheating.
The Headline Numbers
Nvidia forecast fiscal first quarter revenue of around $78 billion.
• Wall Street consensus was about $72.8 billion
• Some analysts had modeled numbers closer to $80 billion
The guidance beat the average estimate, but it did not clear the highest expectations. During the earnings call, shares fell as much as 1.5% before finishing little changed.
For the fiscal fourth quarter ended January 25:
• Revenue rose 73% to $68.1 billion
• Adjusted earnings came in at $1.62 per share
• Analysts had expected $65.9 billion in revenue and $1.53 per share
Adjusted gross margin was 75.2%, slightly ahead of projections.
On paper, this was another massive quarter.
But Nvidia is no longer judged on “good.” It is judged on extraordinary.
AI Growth Is Still the Core Story
The data center division continues to power Nvidia’s performance.
• Data center revenue reached $62.3 billion
• Analyst expectation was $60.4 billion
This unit includes Nvidia’s AI accelerator chips and networking products. It remains the backbone of the company’s growth and its dominance in artificial intelligence infrastructure.
Chief Executive Officer Jensen Huang pushed back against concerns that AI demand may be peaking.
His message was simple: customers are making real money from AI infrastructure, which means they will continue investing.
“You need compute capacity, and that translates directly to growth, and that translates directly to revenues,” Huang said. He expressed confidence that client cash flows are growing, supporting continued spending on Nvidia’s chips.
The company’s Blackwell chips and the upcoming Rubin successor are still expected to exceed earlier sales projections. Nvidia had previously indicated these products could generate $500 billion in revenue by the end of 2026.
Supply Constraints and Execution Risks
Chief Financial Officer Colette Kress addressed concerns around supply constraints.
She said Nvidia has secured enough inventory and supply commitments to meet future demand, including shipments extending into calendar 2027.
However, producing enough of Nvidia’s most advanced chips remains challenging.
A broader issue also hangs over the industry: memory chip shortages.
The global crunch in memory components has pushed prices higher and made it harder to ship devices. This has particularly affected Nvidia’s gaming division.
Gaming revenue came in at $3.73 billion, below the $4.01 billion estimate. Kress acknowledged uncertainty about whether memory supply will improve enough this year to meaningfully lift that segment.
Automotive revenue was also slightly below expectations at $604 million versus a $643 million estimate.
The message is clear. AI data center demand is booming. Other segments are not keeping pace.
China Uncertainty Still Lingers
China remains a significant question mark.
The US government has granted licenses allowing Nvidia to ship a limited number of H200 processors to customers in China. However, the company does not know whether Chinese authorities will approve those shipments.
For now, Nvidia continues to exclude China data center revenue from its forecasts.
The H200 processors must undergo US inspection before shipment and are subject to a 25% tariff when they return to the US.
This regulatory uncertainty adds another layer of risk to Nvidia’s forward outlook, even as AI demand globally remains strong.
Mega Deals and AI Capacity Lock-In
Nvidia continues to deepen relationships with major cloud and AI players.
Earlier this month, Meta Platforms Inc. agreed to deploy “millions” of Nvidia processors over the next few years.
At the same time, rival Advanced Micro Devices Inc. announced its own long term deal with Meta worth multiple tens of billions of dollars.
These mega deals are designed to lock in long term compute capacity and provide visibility on AI infrastructure spending.
However, some critics argue that the increasingly close financial ties between chipmakers and customers could distort real demand signals, especially if companies are taking financial stakes in each other.
For now, Nvidia views these agreements as proof that the AI buildout is not slowing down.
The Bigger Picture
Nvidia has transformed itself from a graphics chip company into the central infrastructure provider for artificial intelligence.
It now sells:
• AI accelerators
• Networking hardware
• General purpose processors
• Full scale AI computing systems
But the market’s skepticism reflects a new reality.
After explosive growth that briefly made Nvidia the world’s most valuable company, investors want stronger proof that this AI spending cycle is durable, not speculative.
The latest results show that growth remains powerful.
The stock’s muted reaction shows that expectations remain even more powerful.
For Nvidia, the numbers are strong.
For investors, the question is no longer about today. It is about how long this momentum can truly last.