NVIDIA: how the business works

Cloud companies, AI developers and computer makers pay NVIDIA for AI chips and systems; making them took $27 of every $100 that came in during FY2026, and $53 was left as profit.

• 01Data Center products gave $193.7 billion of NVIDIA's $215.9 billion FY2026 revenue. Gaming chips gave $16.0 billion.
• 02NVIDIA does not make its own chips. TSMC and Samsung make the silicon wafers; SK Hynix, Micron and Samsung supply the memory.

• Data Center compute

  GPUs and complete AI server systems that cloud companies and AI developers use to train and run AI models. Revenue: $162.4 billion in FY2026.

• Data Center networking

  Switches, network cards and links that connect thousands of chips so they work as one computer. Revenue: $31.4 billion in FY2026, up from $8.6 billion in FY2024.

• Gaming

  GeForce graphics chips for gaming PCs; add-in board makers turn them into graphics cards. Revenue: $16.0 billion in FY2026.

• Professional Visualization

  RTX and Quadro graphics for professional workstations. Revenue: $3.2 billion in FY2026.

• Automotive

  Chips and software for cars. Revenue: $2.3 billion in FY2026.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

• Cloud service providers and AI developers

  Not disclosed

  Buy Data Center chips, systems and networking to build the computers that train and run AI models. NVIDIA does not split revenue by customer type.

• Computer makers and system integrators

  Not disclosed

  OEMs and ODMs (brand and contract computer makers) and integrators build servers, PCs and workstations around NVIDIA chips and resell them.

• Add-in board makers and distributors

  Not disclosed

  Add-in board makers turn GeForce chips into graphics cards; distributors resell NVIDIA products.

• Indirect: an AI research and deployment company

  Not disclosed

  NVIDIA says one AI research and deployment company contributed a meaningful amount of its revenue by buying cloud services from NVIDIA's customers. It gives no share.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026); Form 10-K, fiscal year 2025 (ended Jan 26, 2025)

1. 1Customers paid NVIDIA $215.9 billion in FY2026 for chips, systems and software.
2. 2NVIDIA also earned $11.3 billion: $2.3 billion of interest and $9.0 billion of other income, mostly gains on its stakes in other companies.
3. 3Making the products, including chips bought from TSMC and Samsung, cost $62.5 billion; this includes a $4.5 billion H20 charge for excess stock and purchase commitments.
4. 4Designing the next chips cost $18.5 billion in research; selling and running the company cost $4.6 billion.
5. 5After $21.4 billion of income tax, $120.1 billion was left as net income.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

Each line = amount ÷ total money in × 100. Lines may not add to exactly $100 because of rounding.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

• Chip factories it does not own

  TSMC and Samsung make NVIDIA's wafers, and SK Hynix, Micron and Samsung supply memory. NVIDIA's own long-lived assets were $10.4 billion on Jan 25, 2026.

• Engineers

  About 31,000 of NVIDIA's roughly 42,000 employees worked in research and development at the end of FY2026.

• Supply booked years ahead

  On Jul 26, 2026 NVIDIA had committed $279 billion for supply and capacity, mainly memory, it said. That was $95.2 billion on Jan 25, 2026.

• Cloud capacity and data center leases

  On Jul 26, 2026 NVIDIA had $29 billion of cloud service agreements and $25 billion of data center leases that had not yet started.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026); CFO Commentary on Q2 fiscal 2027 results (Form 8-K Ex. 99.2)

Source: Form 10-K, fiscal year 2024 (ended Jan 28, 2024); Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

• AMD

  Named in NVIDIA's FY2026 10-K as a supplier of GPUs and AI accelerators that compete with NVIDIA's.

• Intel

  Named in the same 10-K as a competitor in GPUs and accelerators.

• Huawei

  Named in the 10-K both as a GPU and accelerator competitor and as a maker of its own AI chips.

• Cloud companies' own chips (Alphabet, Amazon, Microsoft, Alibaba, Baidu)

  The 10-K lists these companies as designing their own AI chips, which compete with NVIDIA's.

• Networking firms (Arista, Broadcom, Cisco, HPE, Marvell)

  The 10-K names them as competitors to NVIDIA's networking products.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026)

• Hyperscale (very large cloud operators)

  Working

  $48.7B in Q2 FY2027, from $24.2B a year earlier

  A Data Center sub-market NVIDIA reports from FY2027. In Q2 FY2027 it moved one company here from ACIE and recast past quarters; both figures are on the recast basis.

  Status: Working, on track against what the company said.

• AI Clouds, Industrial & Enterprise (ACIE)

  Working

  $40.3B in Q2 FY2027, from $16.9B a year earlier

  AI cloud providers, industrial companies and other businesses, as NVIDIA groups them. Same recast basis as Hyperscale.

  Status: Working, on track against what the company said.

• Networking

  Working

  $31.4B in FY2026, from $8.6B in FY2024

  Gear that links chips inside data centers. NVIDIA last split it out on the old platform basis, which ended with FY2026.

  Status: Working, on track against what the company said.

• Edge Computing

  Working

  $7.2B in Q2 FY2027, from $5.6B a year earlier

  PCs, game consoles, workstations, AI for mobile networks, robotics and cars, grouped together from FY2027.

  Status: Working, on track against what the company said.

• Hugging Face acquisition

  New

  $11.9B agreed price (Sep 2026)

  NVIDIA agreed to buy Hugging Face for about $11.9 billion plus up to about $1.0 billion of retention equity. It expects to close in the first half of 2027, subject to regulators.

  Status: New, recently announced.

Status compares progress with what the company itself said it would do: Working = on track against what the company said; Mixed = partly on track; Behind = behind the company's own plan; New = recently announced; Early = too early to judge.

Source: Q2 fiscal 2027 earnings press release (Form 8-K Ex. 99.1); CFO Commentary on Q2 fiscal 2027 results (Form 8-K Ex. 99.2); Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026) and 2 more

EBITDA here = operating income plus depreciation and amortization (from the cash flow statement). Fiscal years are the company's own (Fiscal year ends on the last Sunday of January; FY2026 ended Jan 25, 2026). Net profit is the share belonging to the company's owners.

• Official (GAAP): Net income

  $59.7B

  Company's own measure: Non-GAAP net income

  $54.0B

  Leaves out gains and losses on stakes in other companies ($7.8 billion of gains this quarter), acquisition costs, some other items and their tax effects. It is lower than GAAP net income here because of those gains.

• Official (GAAP): Diluted EPS

  $2.46

  Company's own measure: Non-GAAP diluted EPS

  $2.22

  Per-share version of the non-GAAP net income above, on the same definition.

• Official (GAAP): Operating income

  $63.7B

  Company's own measure: Non-GAAP operating income

  $64.0B

  Leaves out acquisition-related and some other costs. Since Q1 FY2027 it no longer leaves out stock-based pay.

• Official (GAAP): Cash from operations

  $24.1B

  Company's own measure: Free cash flow (company definition)

  $21.3B

  Cash from operations minus spending on equipment and intangible assets, and minus principal payments on equipment and intangibles.

These are the company's own measures, defined by the company. They are not comparable across companies, and they are not added together. Each sits beside the nearest official (GAAP) figure.

Source: Q2 fiscal 2027 earnings press release (Form 8-K Ex. 99.1)

• Net cash = cash ($22.4 billion) + marketable debt securities ($34.1 billion) − senior notes ($33.4 billion). Stakes in other companies are left out: $42.8 billion listed and $51.2 billion unlisted on Jul 26, 2026.
• Borrowings rose from $8.5 billion to $33.4 billion after a $25.0 billion bond sale on Jun 18, 2026. It had seven parts, paying 4.250% to 5.625%, due 2028 to 2056.
• On the same basis, net cash was $41.2 billion on Jan 25, 2026: $49.7 billion of cash and debt securities minus $8.5 billion of notes.
• Lease liabilities are not counted as debt here. Operating lease liabilities were $2.9 billion on Jan 25, 2026.
• Commitments on Jul 26, 2026 totalled $366 billion. Supply and capacity was $279 billion, up from $119 billion on Apr 26, 2026, mainly for memory, NVIDIA said.
• NVIDIA has guaranteed lease values for SB Energy data center sites in Ohio leased to an OpenAI affiliate. It pays only if that tenant becomes insolvent or does not pay; the total is capped at $105 billion.

Source: Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026); Q2 fiscal 2027 earnings press release (Form 8-K Ex. 99.1); CFO Commentary on Q2 fiscal 2027 results (Form 8-K Ex. 99.2) and 3 more

Officers and directors (as a group), shares

3.9%

From the company's proxy statement (DEF 14A), later Schedule 13G filings and the share counts on its latest annual or quarterly report. Each holder row shows the date of its own filing.

Source: Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026); Form 10-K, fiscal year 2026 (ended Jan 25, 2026); 2026 Proxy Statement (Form DEF 14A)

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Form 10-Q, Q1 fiscal 2027 (quarter ended Apr 26, 2026); Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026) and 2 more

• Jen-Hsun Huang

  Founder, President and Chief Executive Officer · since 1993

  Founded NVIDIA in 1993 and has led it since. Held 3.58% of the shares on Mar 23, 2026.

• Colette M. Kress

  Executive Vice President and Chief Financial Officer · since 2013

  NVIDIA files a CFO commentary with each quarter's results.

Source: 2026 Proxy Statement (Form DEF 14A); Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Q4 and fiscal 2026 earnings press release (Form 8-K Ex. 99.1) and 5 more

Auditor

PricewaterhouseCoopers LLP, since 2004

Auditor changes

None in the period covered

Audit qualifications

None reported

Related-party dealings

The 2026 proxy lists the CEO's daughter and son as employees (FY2026 pay about $1.23 million and $1.32 million) and a director's son (about $265,000). It says their pay followed normal company practice. The Huang family foundation buys GPU computing time from CoreWeave to donate to research groups; NVIDIA plans free engineering help for some recipients.

Credit rating

Moody's and S&P (expected ratings in NVIDIA's June 2026 bond term sheet) Aa1 (Moody's) / AA (S&P) (Positive (Moody's) / Stable (S&P)), Jun 15, 2026

A credit rating describes the company's ability to repay debt. It is not a rating of the share.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026); 2026 Proxy Statement (Form DEF 14A); Free writing prospectus (pricing term sheet), June 2026 senior notes, incl. expected ratings and 4 more

Share price

$210.96

Market value (market cap)

$5.09T

P/E

26.7×

P/B

22.2×

Source: NVDA historical daily prices (close on Oct 23, 2026); Form 10-Q, Q2 fiscal 2027 (quarter ended Jul 26, 2026); Q2 fiscal 2027 earnings press release (Form 8-K Ex. 99.1) and 3 more

• Regulation

  US and China rules limit NVIDIA's China data center sales

  Since 2022 the US has required licences for NVIDIA's top data center chips sold to China. A rule on H20 chips in April 2025 led to a $4.5 billion charge. NVIDIA says it was effectively foreclosed from China's data center compute market. China revenue fell from $25.0 billion in FY2025 to $19.7 billion in FY2026.

  Watch Licence decisions and China revenue in each 10-Q ($7.9 billion in Q2 FY2027, not split by product).

• Concentration

  A few unnamed customers bring in much of the revenue

  Two direct customers gave 22% and 14% of FY2026 revenue; one gave 16% in Q2 FY2027. Money owed by customers reached $63.1 billion on Jul 26, 2026, or 60 days of sales, up from 45 in Q1. NVIDIA linked this to longer payment terms for some large customers.

  Watch Customer shares and days of sales owed in each 10-Q and CFO commentary.

• Demand

  Large supply commitments if demand slows

  On Jul 26, 2026 NVIDIA had committed $279 billion for supply and capacity, up from $95.2 billion in January. When the 2025 H20 rule stopped sales, NVIDIA took a $4.5 billion charge for excess stock and purchase commitments.

  Watch Commitments table and inventory charges in each 10-Q ($2.1 billion of provisions in the first half of FY2027).

• Debt

  Contingent guaranties for OpenAI-leased data centers

  NVIDIA backs lease values on about 4.25 GW of SB Energy data centers in Ohio, with an OpenAI affiliate as tenant. It pays only if the tenant becomes insolvent or does not pay. Exposure is capped at $105 billion, starts as leases begin (from FY2029) and OpenAI agreed to reimburse NVIDIA.

  Watch Lease start dates, any added sites (an option covers about 3.8 GW more) and the guarantees note in each 10-Q.

• Competition

  Rivals, including some large buyers, design their own chips

  The FY2026 10-K names AMD, Huawei and Intel as GPU rivals. It also lists Alibaba, Alphabet, Amazon, Baidu, Huawei and Microsoft as designing their own AI chips.

  Watch Hyperscale revenue each quarter ($48.7 billion in Q2 FY2027).

• Execution

  Depends on a few outside chip and memory makers

  TSMC and Samsung make NVIDIA's wafers; SK Hynix, Micron and Samsung supply memory. NVIDIA owns no chip factories, so a supply problem at these firms could limit what it can ship.

  Watch Supply commitments and any supply constraints NVIDIA reports in its 10-Qs.

• Other

  Stakes in other companies swing reported profit

  On Jul 26, 2026 NVIDIA held $42.8 billion of listed stakes and $51.2 billion of unlisted ones. Gains on them were $15.9 billion in Q1 FY2027 and $7.8 billion in Q2, counted in net income.

  Watch Gains or losses on equity securities in other income each quarter.

Source: Form 8-K (Item 8.01): August 2022 license requirement for A100/H100 exports to China and Russia; Form 8-K (Item 8.01): H20 export license requirement and expected Q1 FY2026 charges; Q1 fiscal 2026 earnings press release (Form 8-K Ex. 99.1) and 6 more

Source: 2026 Proxy Statement (Form DEF 14A); Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Form 8-K (Item 8.01): August 2022 license requirement for A100/H100 exports to China and Russia and 9 more

What does NVIDIA do?

NVIDIA Corporation, based in Santa Clara, California, designs graphics processors (GPUs), AI computer systems, networking gear and software. NVIDIA does not make its own chips: TSMC and Samsung make the wafers. In FY2026 (the year ended Jan 25, 2026), Data Center products gave 89.7% of NVIDIA's $215.9 billion revenue.

How does NVIDIA make money?

NVIDIA sells chips, complete AI systems and networking to companies that build data centers, and graphics chips to PC and workstation makers. In FY2026 NVIDIA kept $120.1 billion of net income from $215.9 billion of revenue, or $55.6 of every $100 of revenue.

Who are NVIDIA's customers?

NVIDIA's direct customers include cloud service providers, computer makers, add-in board makers, distributors, system integrators and AI model makers. In FY2026 two direct customers, which NVIDIA does not name, gave 22% and 14% of NVIDIA's revenue.

How big is NVIDIA?

NVIDIA's FY2026 revenue was $215.9 billion, up 65.5% from $130.5 billion in FY2025, and its net income was $120.1 billion. In Q2 FY2027 (the quarter ended Jul 26, 2026) NVIDIA's revenue was $96.2 billion. NVIDIA had about 42,000 employees at the end of FY2026.

Where are NVIDIA's customers?

By the location of customers' headquarters, US-based customers gave 69.3% of NVIDIA's FY2026 revenue, Taiwan-based customers 19.6% and China (including Hong Kong) 9.1%. NVIDIA estimates that 76% of its FY2026 Data Center revenue from Taiwan-based customers went to end customers in the US and Europe.

Who owns NVIDIA?

NVIDIA has one class of common stock, traded on Nasdaq as NVDA, with one vote per share. On Mar 23, 2026 NVIDIA's directors and executive officers held 3.94% of the shares, including 3.58% held by founder and CEO Jen-Hsun Huang. NVIDIA's 2026 proxy statement lists BlackRock (7.43%) and Vanguard (7.31%) as 5% holders.

How much debt does NVIDIA have?

On Jul 26, 2026 NVIDIA had $33.4 billion of senior notes, after a $25.0 billion bond sale in June 2026. NVIDIA also held $56.6 billion of cash and marketable debt securities on that date.

Does NVIDIA pay dividends or buy back shares?

In FY2026 NVIDIA spent $40.4 billion buying back 282 million of its own shares and paid $974 million of dividends. In May 2026 NVIDIA raised its quarterly dividend from $0.01 to $0.25 a share.

Source: Form 10-K, fiscal year 2026 (ended Jan 25, 2026); Q2 fiscal 2027 earnings press release (Form 8-K Ex. 99.1); 2026 Proxy Statement (Form DEF 14A) and 3 more

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