Wall Street's growth expectations for Nvidia may be too conservative because hyperscaler capital expenditure grew 92% year-over-year and 29% quarter-over-quarter in the three months ended June 30, the fastest pace since ChatGPT launched, and public cloud revenue growth at the three largest cloud vendors accelerated to its fastest pace ever.
We expect Nvidia to deliver a solid quarter with meaningful upside to guidance, supported by tight GPU supply and demand trends.
Nvidia is the cleanest test of whether AI infrastructure demand has actually peaked, and if it keeps delivering accelerating revenue while holding gross margins in the mid-70% range, it would be difficult to argue the compute cycle is rolling over.
Nvidia reported net income of $59.69 billion, or $2.46 per share, and revenue of $96.22 billion for the May-July 2026 quarter, more than doubling revenue from a year earlier and surpassing Wall Street's expectations.
Nvidia forecast revenue of about $108 billion for the August-October 2026 quarter, above analysts' forecast of $104.86 billion, which would represent roughly an 89% increase from a year earlier.
Nvidia's shares slipped 0.3% in after-hours trading shortly after it released its latest results, after ending the regular trading session 1.6% lower.
AI has reached its inflection point; it is doing useful work, its tokens are productive and profitable, and now compute is revenue.
Nvidia does not face a serious challenger at its layer of the stack and is probably the best chance for public market investors to profit from the AI boom.
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