India, Feb 26 : Nvidia projected first quarter revenue above market expectations on Wednesday, underscoring robust Nvidia AI chip demand driven by continued heavy investment from global technology giants.
The company said it has secured sufficient chip inventory and manufacturing capacity to meet customer requirements over the coming quarters, easing concerns about supply bottlenecks at Taiwan Semiconductor Manufacturing Co. (TSMC). However, it cautioned that supply constraints could weigh on its gaming segment.
Chief Financial Officer Colette Kress told analysts that growth is expected to outpace the previously disclosed $500 billion revenue pipeline for 2026. She indicated that expansion is anticipated in every quarter of calendar 2026, though no detailed timeline was provided.
Shares climbed more than 3% in extended trading following the earnings release.
Chief Executive Officer Jensen Huang said customers are accelerating investments in AI computing infrastructure, describing data centres as the “factories” powering the AI industrial revolution.
Strong Guidance and Quarterly Beat
The company expects fiscal first-quarter sales of $78 billion, plus or minus 2%, surpassing analysts’ average estimate of $72.60 billion, according to LSEG data.
For the January quarter, revenue reached $68.13 billion, ahead of expectations of $66.21 billion. Adjusted earnings came in at $1.62 per share, topping forecasts of $1.53.
Investors closely track Nvidia’s performance as a barometer of whether massive spending by hyperscalers such as Alphabet, Microsoft, Amazon and Meta on data centres and processors is translating into tangible returns. These firms have projected capital expenditure of at least $630 billion in 2026, largely focused on AI infrastructure.
Analysts say the latest results show no immediate signs of a slowdown in AI investment, with data centre revenue increasingly diversified beyond the largest cloud players.
Competitive Pressures and China Outlook
Despite its dominance, Nvidia faces rising competition. AMD plans to introduce a new AI server platform later this year and has secured partnerships with major cloud customers. Alphabet’s Google is also promoting its in-house Tensor Processing Units (TPUs) and expanding supply agreements.
Sales concentration remains a factor, with two customers accounting for 36% of total revenue in fiscal 2026.
Nvidia noted that its current-quarter forecast excludes expected revenue from data centre chip sales to China due to U.S. export restrictions. However, it confirmed receiving licences this month to ship limited quantities of its H200 processors to Chinese customers.
Huang recently expressed optimism that approvals for broader sales in China could follow.
Talent Strategy and Long-Term Confidence
The company also announced it will begin including stock based compensation in its non-GAAP financial metrics, highlighting its importance in attracting and retaining top AI talent.
With demand for advanced computing accelerating globally across enterprises and governments, Nvidia signalled confidence in its long-term trajectory, positioning itself at the centre of expanding AI infrastructure investment worldwide.