Nvidia's beat-and-raise resets AI expectations - what finance teams should do now
Nvidia cleared the bar. The company beat Q4 expectations and guided Q1 revenue above consensus, sending shares higher in early trading. The update reinforced the core thesis: AI infrastructure spend remains intense, concentrated among hyperscalers, and still expanding into broader enterprise workloads.
Here are the numbers and the practical reads for budgets, risk, and portfolios.
Key Q4 results and Q1 outlook
- Q4 revenue: $68.13B (vs. $65.8B est; $39.3B a year ago)
- Q4 EPS: $1.62 (vs. $1.53 est; $0.89 a year ago)
- Gross margin: 75.2% (vs. 75% est)
- Data Center revenue: $62.3B (vs. $60.2B est)
- Gaming revenue: $3.7B (vs. $4.0B est)
- Data Center detail: Compute $51.3B (+58% YoY), Networking $11.0B (+263% YoY), both at record highs
- Q1 revenue guide: $76.44B-$79.56B (vs. $72.78B est)
Takeaway: the AI compute cycle remains intact, with margin resilience and higher throughput from networking. Model this as sustained capex support through 2026 unless you see clear evidence of utilization bottlenecks or policy shocks.
Hyperscaler spend is the fulcrum
Management highlighted that the top five cloud providers and hyperscalers account for a little over half of Data Center revenue. Analysts now peg their 2026 capex near $700B, up almost $120B since the start of the year.
- Reallocate coverage time to cloud capex trackers and supplier backlog, not end-user indicators.
- Assume continued shift of classic data center workloads to GPU acceleration. Build scenarios for both training and inference density growth.
- Expect Nvidia to maintain pricing leverage as long as networking throughput and software lock-in drive total system performance.
China export status: approvals exist, revenue doesn't
The company confirmed it has not recognized any H200 revenue from China. While small amounts were approved by the U.S. government for China-based customers, imports remain uncertain. Reports indicate Chinese tech giants received approvals to purchase more than 400,000 H200 units, but timing risk is high.
- Model China revenue contribution near zero for now; treat any deliveries as upside optionality.
- Compliance and logistics remain key variables; keep a live risk register tied to export policy updates.
OpenAI and platform breadth
The CEO said Nvidia is close to finalizing an agreement with OpenAI. The prior headline figure of $100B was walked back earlier this year; separate reporting suggested discussions around a smaller deal size near $30B. Nvidia also continues to partner with Anthropic and Google, and emphasized broad startup adoption.
- Read this as reinforcement of a model-agnostic platform strategy that protects unit volumes across architectures.
- For forecasting, widen scenario bands for accelerator mix, software attach, and networking pull-through.
Portfolio read-across
- Semis and equipment: Strength in GPUs and networking supports upstream suppliers; watch lead times and any substitution to custom silicon.
- Cloud & colocation: Rising AI loads favor operators with power, cooling, and land flexibility; utilization discipline remains the swing factor.
- Enterprise software: Budgets are tilting to AI infrastructure; seat expansion and module upsells face scrutiny unless tied to AI outcomes.
- Utilities & components: Data center build-outs support demand for electrical gear and grid upgrades; timing varies by permitting and interconnect queues.
Market wrap: other moves that matter
- Salesforce (CRM): FY2027 revenue guide $45.8B-$46.2B (midpoint a touch below Street). Stock slipped after-hours. Raised 2030 target to $63B, citing agentic AI. Finance angle: near-term growth softer while long-term AI monetization case remains; monitor margin investment cadence.
- Workday (WDAY): Beat on revenue ($2.53B) and EPS ($2.47) but outlook disappointed; stock fell ~8%. Finance angle: customers are scrutinizing price-to-value as AI features roll out; build more conservative new-logo and expansion rates.
- HP Inc. (HPQ): Q1 beat ($14.44B revenue; $0.81 EPS) but guided FY results to the low end amid U.S. trade rules and memory cost pressure. Finance angle: PC recovery helps, but cost lines and policy risk cap upside; watch memory pricing and mix.
- Lowe's (LOW): Q4 beat (comps +1.3%) but FY2026 guide light (EPS $12.25-$12.75; comps flat to +2%); shares dipped. Finance angle: housing turnover stays constrained by rates; assume steady Pro strength but muted DIY.
- First Solar (FSLR): FY2026 sales guide $4.9B-$5.2B vs. $5.6B expected; stock down ~16%. Finance angle: project timing and pricing discipline weigh near term; keep an eye on factory ramp execution and booking pace.
- Circle: Q4 revenue up with USDC circulation +72% YoY to $75.3B; reserves revenue $733M; stock up ~14%. Finance angle: treasury yield backdrop and policy clarity support stablecoin economics; assess counterparty, custody, and regulatory exposure before treasury use.
- HSBC: 2025 PBT $29.91B (beat), with revenue +4% to $68.3B. Finance angle: notable items and restructuring weighed on profits; rate path and credit costs drive 2026 variances.
- Steve Madden: Withdrew 2026 earnings outlook amid tariff uncertainty after a recent Supreme Court decision and a new temporary import tariff. Finance angle: reset consumer margin and pricing pass-through assumptions; scenario test 10%-15% import costs.
Action steps for finance teams
- Refresh 2026-2027 AI capex scenarios; anchor base case on hyperscaler spend approaching $700B, with sensitivity to utilization and supply timing.
- Revisit margin models for AI vendors: include networking mix, software attach, and normalized depreciation for shorter server lives.
- Set policy risk guardrails: export controls (China/H200), import tariffs, and data residency. Tie each to revenue recognition and COGS triggers.
- For enterprise software coverage, temper seat growth and assume AI feature adoption follows proof-of-value milestones, not headlines.
- If you manage treasury or payments exposure, formalize a stablecoin policy covering custody, liquidity, and regulatory thresholds.
- For consumer names, add tariff pass-through elasticity and supplier renegotiation timelines into working capital and pricing models.
Resources
- Nvidia Investor Relations - latest filings, presentations, and segment detail
- AI for Finance - practical applications of AI for forecasting, risk, and investment analysis
Your membership also unlocks:
