Dive Brief:
- Nvidia’s second quarter revenue soared to $46.7 billion, up 56% from a year ago, driven by strong demand for data center-related products and services.
- The company’s meteoric growth has come in part from a handful of companies. Two unnamed customers made up 39% of Nvidia’s total revenue in the latest quarter, according to a recent securities filing.
- “Customer A” made up 23% of total revenue, while “Customer B” comprised 16%, according to Nvidia’s Q2 fiscal year 2026 earnings report, which accounted for the three months that ended July 27.
Dive Insight:
In recent months, customers have been upgrading to Blackwell chips, specifically the GB200 and GB300 models sold as components on the NVL72 rack systems, to increase their artificial intelligence capabilities and computing speeds. Nvidia began production shipments of GB300 in Q2, according to the securities filing.
“We’re ramping really hard into data centers,” CEO Jensen Huang said in an earnings call Aug. 27. “This year is obviously a record-breaking year. I expect next year to be a record-breaking year.”
Nvidia posted Q2 net income of $26.4 billion, up 59% over last year. CFO Colette Kress said on the call that Nvidia’s full stack AI solutions for cloud service providers and other customers are contributing to the company’s growth.
“We are at the beginning of an industrial revolution that will transform every industry,” Kress said. “We see $3 trillion to $4 trillion in AI infrastructure spend by the end of the decade.”
Major customers like Microsoft, Amazon and Google are building out their AI infrastructure with Nvidia’s chips and racks in the race for AI dominance. In June, Meta’s Mark Zuckerberg pledged to spend hundreds of billions of dollars to build several massive AI data centers for superintelligence, Reuters reported. Meta is a major buyer of Nvidia’s chips.
As cloud service providers build out their infrastructures, Nvidia’s Q2 data center revenue has surged to $41.1 billion, up 56% from a year ago. This was driven in part by two direct customers that accounted for 39% of the company’s total revenue, according to an investor filing. In the same quarter last year, Nvidia’s top two customers made up 14% and 11% of sales.
While no details were provided about who the top customers could be, Nvidia reported that an “AI research and deployment company” contributed to a meaningful amount of revenue through a mix of direct and indirect customers.
“We have experienced periods where we receive a significant amount of our revenue from a limited number of customers, and this trend may continue,” the company disclosed to investors in the filing.
Looking ahead, Nvidia is expecting Q3 revenue to grow sequentially to $54 billion. Nvidia excluded any assumed H20 chip sales to China after geopolitical issues jammed shipments earlier this year.
In late July, the U.S. government began reviewing licenses for H20 sales to China customers, however, Nvidia has not shipped any of the products based on those licenses, Kress said. Currently, the U.S. government is expecting 15% of the revenue generated from those sales, but no official regulation requirement has been published yet.
“If geopolitical issues reside, we should ship $2 billion to $5 billion in H20 revenue in Q3,” Kress said. “And if we had more orders, we can bill more.”
Blackwell chips are still prohibited to sell in China.
