Nvidia's supply commitments reach 279 billion dollars as AI hardware revenue surges
Nvidia's quarterly revenue rose 106 per cent to 96.2 billion dollars while its supply commitments, mostly for memory, reached 279 billion dollars. HP's PC-unit revenue grew 18 per cent even as device shipments fell 16 per cent, highlighting a shift toward higher-priced AI and premium systems. Rapid revenue growth is reaching hardware companies through different balance-sheet channels, from memory costs to product mix.
Economics & Markets··Morning
Revenue stretches from chips to premium PCs
Nvidia reported second-quarter revenue of 96.2 billion dollars, up 106 per cent from a year earlier, while gross margin held at 75 per cent. HP's third-quarter revenue rose 12.5 per cent to 15.7 billion dollars. The HP Personal Systems unit grew 18 per cent even as total device shipments fell 16 per cent, showing that revenue shifted toward more expensive premium computers. Strong demand therefore appeared in chip-scale sales at one company and in the value of machines sold at the other.[1], [2]
Growth costs emerge in supply and product mix
Nvidia's supply commitments, mostly for memory, climbed from 119 billion dollars to 279 billion dollars in one quarter. The company expects gross margin to narrow toward 71-72 per cent by the fourth quarter as memory costs rise. HP generated more PC revenue while shipping fewer devices; commercial-system revenue increased 22 per cent and consumer revenue rose 10 per cent. The results show AI-hardware growth requiring suppliers to lock in inputs early and sellers to lean toward higher-priced products.[1], [2]
New targets keep growth running
Nvidia guided third-quarter revenue to roughly 108 billion dollars and spent 26 billion dollars on buybacks and dividends in the latest quarter. HP raised its full-year targets to 3.19-3.29 dollars in non-GAAP earnings per share and 3.0-3.2 billion dollars in free cash flow. It also expects tariff refunds to add 19 cents to annual earnings per share. Both companies are pairing continued growth with plans for capital returns and margin management.[1], [2]
