Nvidia(NVDA) Tianfeng Securities·2025-06-10 08:58Investment Rating - The investment rating for NVIDIA is "Buy" with a maintained rating for the next six months [7] Core Insights - NVIDIA's overall performance exceeded expectations with total revenue of $44.1 billion for FY26Q1, representing a 69.0% year-over-year increase, surpassing market expectations of $43.3 billion [1] - The non-GAAP gross margin was reported at 61%, and if excluding a $4.5 billion impairment charge, it would have been 71.3%, slightly above Bloomberg's consensus of 70.96% [1] - Net profit for the quarter was $23.6 billion, exceeding Bloomberg's consensus of $23.1 billion [1] - The strong demand for AI continues to drive high revenue growth quarter-over-quarter [1] Business Segment Summary - Data center revenue reached $39.1 billion, slightly below consensus expectations of $39.2 billion; Compute business generated $34.155 billion, a 76.1% year-over-year increase, but below the expected $35.469 billion [2] - Networking revenue was $4.96 billion, a 56.3% year-over-year increase, significantly exceeding the expected $3.45 billion [2] - Gaming revenue was $3.763 billion, a 42.2% year-over-year increase, far surpassing the expected $2.845 billion [2] - Professional visualization revenue was $509 million, a 19.2% year-over-year increase, slightly above the expected $505 million [2] - Automotive revenue was $567 million, a 72.3% year-over-year increase, in line with expectations [2] - OEM & Other revenue was $111 million, below the expected $118 million [2] Guidance and Future Outlook - NVIDIA expects total revenue for Q2 to be around $45 billion (±2%), with moderate sequential growth across all business segments [3] - The company anticipates a recovery in gross margin to 75% by the end of the year [3] - The Blackwell architecture is expected to drive continued growth in the data center segment, although revenue from the Chinese market is projected to decline significantly due to export restrictions [5] - The company has accounted for an estimated $8 billion revenue loss from the Chinese market in its Q2 guidance [5] Investment Recommendation - The report indicates that NVIDIA's performance has exceeded expectations, with accelerating demand for AI data centers driven by the release of Blackwell products [6] - Adjustments have been made to the GAAP net profit forecasts for FY26-28, now projected at $99.4 billion, $140.3 billion, and $166.6 billion respectively [6]