Nvidia(US:NVDA)2025-11-19 21:36Revenue Performance - Revenue for the third quarter of fiscal year 2026 was $57.0 billion, representing a 62% increase year-over-year and a 22% increase sequentially [126]. - Data Center revenue reached $51.2 billion, up 66% year-over-year and 25% sequentially, driven by accelerated computing and AI solutions [127]. - Data Center compute revenue was $43.0 billion, reflecting a 56% increase year-over-year and a 27% increase sequentially [128]. - Networking revenue surged to $8.2 billion, a 162% increase year-over-year, attributed to the growth of NVLink compute fabric [128]. - Gaming revenue increased by 30% year-over-year but decreased by 1% sequentially, as channel inventories normalized [129]. - Professional Visualization revenue rose 56% year-over-year and 26% sequentially, driven by the launch of the new DGX Spark [130]. - Compute & Networking revenue increased by 62% year-over-year to $35,721 million for the third quarter of fiscal year 2026, driven by demand for the Blackwell computing platform [138]. - Data Center computing revenue grew 59% year-on-year compared to the first nine months of fiscal year 2025, while Data Center networking revenue surged 105% year-on-year in the same period [138]. Operating Expenses and Margins - Operating expenses increased by 36% year-over-year and 8% sequentially, primarily due to higher compute and infrastructure costs [132]. - The gross margin for the third quarter was 73.4%, a decrease of 1.2 percentage points year-over-year but an increase of 1.0 percentage point sequentially [126]. - Gross margin decreased to 73.4% for the third quarter of fiscal year 2026, down from 74.6% in the same quarter of fiscal year 2025, impacted by a $4.5 billion charge related to excess inventory [148]. - Total operating expenses rose by 36% year-over-year to $5,839 million for the third quarter of fiscal year 2026, primarily due to a 39% increase in research and development expenses [151]. Financial Position and Cash Flow - Cash and cash equivalents increased to $11,486 million as of October 26, 2025, up from $8,589 million at the beginning of the year [162]. - Net cash provided by operating activities for the first nine months of fiscal year 2026 was $66,530 million, an increase from $47,460 million in the same period of fiscal year 2025 [163]. - As of October 26, 2025, the company had $60.6 billion in cash, cash equivalents, and marketable securities, ensuring sufficient liquidity for at least the next twelve months [166]. - The company repurchased 70 million shares for $12.6 billion in Q3 and 262 million shares for $36.7 billion in the first nine months of fiscal year 2026 [169]. - Cash dividends paid to shareholders amounted to $243 million in Q3 and $732 million in the first nine months of fiscal year 2026 [171]. Tax and Regulatory Matters - Income tax expense for the third quarter of fiscal year 2026 was $6.0 billion, with an effective tax rate of 15.9%, compared to $3.0 billion and 13.5% for the same quarter of fiscal year 2025 [156]. - Unrecognized tax benefits totaled $3.2 billion as of October 26, 2025, including related interest and penalties [175]. Strategic Investments and Commitments - The company committed to invest $5 billion in Intel Corporation and up to $10 billion in Anthropic, subject to regulatory approval and closing conditions [176]. - An additional $60.0 billion in share repurchase authorization was approved by the Board of Directors on August 26, 2025, bringing the total authorized repurchase amount to $62.2 billion [169]. Inventory and Supply Chain - The company incurred a $4.5 billion charge in Q1 FY 2026 due to diminished demand for the H20 product following new export regulations [119]. - Provisions for inventory and excess inventory purchase obligations totaled $410 million for the third quarter of fiscal year 2026, including $4.5 billion associated with excess inventory [149]. - The company is increasing U.S.-based manufacturing to strengthen its supply chain and meet growing demand for AI infrastructure [123]. Customer Concentration and Geographic Revenue - The company generated significant revenue from a limited number of direct customers, with four customers representing 61% of total revenue in the third quarter of fiscal year 2026 [142]. - Revenue from customers headquartered outside the United States accounted for 31% of total revenue for the third quarter of fiscal year 2026, down from 44% in the same quarter of fiscal year 2025 [146]. Debt and Financial Instruments - Aggregate debt maturities as of October 26, 2025, total $8.467 billion, with $1 billion due in one year and $2.75 billion due in one to five years [173]. - The company has a $575 million commercial paper program, with no commercial paper outstanding as of October 26, 2025 [173]. - A hypothetical 10% decrease in publicly-held equity securities would decrease their fair value by $387 million as of October 26, 2025 [181]. Sustainability and Regulatory Impact - There has been no material impact from global sustainability regulations or climate-related business trends on the company's operations [178].