NVIDIA Q4 Revenue Surges 73%, Beating Expectations Again! But Concentrated Data Center Demand Sparks Concern

 

NVIDIA Corp. reported fourth-quarter fiscal 2025 earnings after the bell on Wednesday, extending a years-long streak of benchmark-setting performance.

 

While the AI darling once again cleared Wall Street’s high bar—sending shares up 3% in initial after-hours trading—the stock later pared gains as investors scrutinized a heavy concentration of demand among a few hyperscale customers.

NVIDIA Beats on Top and Bottom Lines

For the quarter ended January, NVIDIA reported earnings per share (EPS) of $1.62, outpacing the $1.53 projected by analysts. Revenue for the period hit $68.13 billion, a 20% sequential increase and a 73% surge from the prior year, well ahead of the $66.2 billion consensus estimate.

 

Full-year fiscal 2025 revenue grew 68% to a record $193.7 billion. This marks the second consecutive year in which the company has exceeded Wall Street revenue estimates in every quarter.

 

"Our customers are racing to invest in AI computing—the factories driving the AI industrial revolution and its future growth," CEO Jensen Huang said in a statement.

 

 

For the first quarter of fiscal 2026, NVIDIA guided for revenue of $78.0 billion (plus or minus 2%), representing a 77% year-over-year increase. This outlook significantly outperformed the $72.0 billion expected by analysts. Gross margins are projected to be 74.9%, roughly in line with expectations and up from 71.3% a year ago.

Hyperscale Concentration Sparks Caution

The company’s massive growth continues to be powered by its Data Center segment, which saw revenue jump 75% year-over-year to $62.3 billion.

 

However, CFO Colette Kress disclosed in the earnings report that approximately half of the data center sales were derived from the company’s largest hyperscale customers. 

 

This disclosure may heighten concerns regarding the heavy concentration of NVIDIA's customer base and potential "circular trades" between the company and its major tech clients—dynamics that echo the conditions of the dot-com bubble over two decades ago.

 

Beyond the data center segment, gaming revenue reached $3.7 billion, representing a 47% year-over-year increase but a 13% sequential decline. The company stated that "channel inventory naturally moderated following strong holiday demand."

 

Professional Visualization revenue hit $1.3 billion, more than doubling year-over-year and jumping 74% from the previous quarter. Automotive revenue edged up 2% sequentially and 6% year-over-year to $604 million.#nvidia