Srikas
06:33

NVIDIA: AI Growth Is Still Strong — But Margins Are the Question

NVIDIA continues to dominate the AI infrastructure story, with another record quarter highlighting just how strong demand for accelerated computing remains.

🚀 Key numbers:

• Revenue: $96.22B, up 106% YoY

• Data Center growth: +117% YoY

• Gross margin: around 75%

• Rubin is moving closer to full production

• Shares initially gained around 4% after hours

But there’s an interesting catch…

NVIDIA expects gross margins to come under pressure, potentially reaching the 71–72% range, largely because of higher component costs.

That raises an important question for investors:

Can NVIDIA maintain its extraordinary growth while protecting its margins?

The AI demand story clearly isn’t slowing down. The next generation of Rubin could create another major growth wave, but investors will be watching margins, supply-chain costs and execution very closely.

💭 My take: NVIDIA’s AI leadership remains extremely strong, but going forward, revenue growth alone may not be enough. The market could increasingly focus on how profitable that growth is.

Do you think NVIDIA’s supply chain and Rubin ramp can push the stock higher from here, or are margin pressures becoming a bigger risk?

Nvidia Reclaims AI Narrative — But at What Cost to Gross Margins?
Nvidia's record quarter: revenue $96.221bn, +106% year-over-year and past the ~$93.6bn consensus, data center +117%, gross margin held at 75%. Rubin is accelerating toward full production, with Huang framing AI as the point where compute converts directly into revenue. The catch is memory: Q4 gross margin troughs at 71–72%, three to four points conceded to component costs. Shares +4% after hours, carrying memory, optical and cloud names along. Worth remembering the stock has fallen the day after earnings four quarters running. Does the supply chain rally from here?
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Comments

  • CuritisCissie
    07:12
    CuritisCissie
    A 3 to 4 point gross margin drop matters more than the revenue beat here. If Rubin ramps cleanly, the multiple can hold, but supply chain costs are starting to eat into the premium.
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