NVIDIA Corporation (NVDA) - Fiscal Year 2026 10-K Summary
Business Context and Reporting Period
This summary covers NVIDIA Corporation's Annual Report on Form 10-K for the fiscal year ended January 25, 2026. NVIDIA operates as a data center-scale AI infrastructure company, reporting results through two segments: Compute & Networking (Data Center, Automotive) and Graphics (Gaming, Professional Visualization). The company continues to transition from Hopper to Blackwell and Blackwell Ultra architectures, with the Rubin platform expected to commence production in fiscal 2027.
Key Financial Metrics
| Metric | Fiscal 2026 | Fiscal 2025 | Change |
|---|---|---|---|
| Total Revenue | $215.9 billion | $130.5 billion | +65% |
| Gross Margin | 71.1% | 75.0% | -3.9 pts |
| Operating Income | $130.4 billion | $81.5 billion | +60% |
| Net Income | $120.1 billion | $72.9 billion | +65% |
| Diluted EPS | $4.90 | $2.94 | +67% |
| Operating Cash Flow | $102.7 billion | $64.1 billion | +60% |
| Cash & Marketable Securities | $62.6 billion | $43.2 billion | +45% |
| Total Debt (Carrying Amount) | $8.5 billion | $8.5 billion | Flat |
Material Changes vs. Prior Period
- Revenue Growth: Driven primarily by the Compute & Networking segment, which grew 67% to $193.5 billion. Data Center revenue increased 68%, fueled by demand for Blackwell computing platforms and a 142% surge in Data Center networking revenue.
- Gross Margin Compression: Margins declined 3.9 percentage points due to the business model transition from Hopper HGX systems to Blackwell full-scale datacenter solutions and a $4.5 billion charge in Q1 2026 related to H20 excess inventory and purchase obligations caused by U.S. export restrictions.
- Operating Expenses: Increased 41% to $23.1 billion, driven by a 29% rise in compensation and benefits and a 79% increase in compute and infrastructure costs.
- Other Income: "Other income, net" surged to $9.0 billion (from $1.0 billion in 2025), primarily due to unrealized gains on non-marketable and publicly-held equity securities, including investments in Intel.
- Acquisitions: Recorded $14.4 billion in goodwill and a $2.5 billion intangible asset related to a non-exclusive license agreement with Groq, Inc.
Guidance, Outlook, and Risks
- Product Roadmap: NVIDIA is executing a one-year product cadence for Data Center solutions. The Blackwell Ultra platform (including GB300) began shipping in Q2 2026. The Rubin platform is targeted for production shipments in H2 2027.
- Supply Chain: Management expects supply constraints to be a headwind to the Gaming segment in Q1 2027 and beyond. The company is expanding manufacturing into the U.S. and Latin America to add redundancy.
- Export Controls (Critical Risk): U.S. government restrictions effectively foreclosed NVIDIA from China's data center market as of the end of FY2026. While limited licenses were granted for H20 and H200 products, the company faces a 25% tariff on H200 imports and uncertainty regarding future approvals. This has benefited competitors and created a $4.5 billion inventory charge.
- Capital Allocation: The Board approved an additional $60.0 billion share repurchase authorization. In FY2026, the company repurchased $40.4 billion of stock and paid $974 million in dividends.
- Regulatory Scrutiny: Facing antitrust inquiries in the EU, U.S., UK, and China regarding market dominance and supply allocation. The EU AI Act and new U.S. state laws regarding AI are increasing compliance costs.
Investor Verification Checklist
- China Exposure: Verify the extent of revenue loss from the China data center market and the timeline for potential re-entry under new export rules.
- Inventory Valuation: Review the $21.4 billion inventory balance and the $95.2 billion in outstanding purchase commitments against future demand forecasts, particularly for H20 and legacy architectures.
- Customer Concentration: Note that one direct customer represented 22% of total revenue and another 14% in FY2026; assess the risk of order cancellations or delays from these top clients.
- Blackwell Ramp: Confirm the production yield rates and supply availability for Blackwell Ultra and GB300 systems to ensure they meet the aggressive one-year cadence.
- Investment Portfolio: Scrutinize the $22.3 billion in non-marketable equity securities and the volatility of the $17.7 billion in publicly-held equity securities, which contributed significantly to "Other income."