Nvidia Surpasses Q4 Earnings Expectations and Raises Q1 Revenue Forecast Above Wall Street Estimates with Data Center Driving Growth

Nvidia reported fiscal fourth-quarter results that surpassed analysts’ estimates in both revenue and earnings per share. The company also provided an optimistic outlook for the first quarter, forecasting revenue between $76.44 billion and $79.56 billion, well above the Wall Street consensus of $72.8 billion.

The forecast notably excludes any anticipated revenue from China, indicating potential upside if the Chinese market contributes. Following the earnings release, Nvidia shares initially rose about 3% in premarket trading before settling to a 1% gain.

Strong Q4 Performance Driven by Data Center Growth

Nvidia posted earnings per share of $1.62 on revenue of $68.1 billion for the quarter. This exceeded expectations of $1.53 EPS and $65.8 billion in revenue, reflecting robust growth compared to $0.89 EPS and $39.3 billion in revenue from the same quarter last year.

The data center segment was the primary driver of growth, generating $62.3 billion in revenue versus estimates of $60.2 billion. CFO Colette Kress highlighted that hyperscalers accounted for over half of data center revenue, with remaining growth stemming from a diversified set of customers. She said, "For the fourth quarter, hyperscaler revenue increased and remained our largest customer category at slightly over 50% of Data Center revenue, while growth was led by the rest of our Data Center customers as revenue diversified."

Within the data center business, Nvidia further broke down results showing compute revenue grew 58% year over year, while networking revenue surged 263%, reaching $11 billion. This uptick underscores Nvidia’s expanding footprint across multiple data center technology verticals including compute chips, graphics processing units, CPUs, and networking solutions.

Momentum Fueled by AI Investments and Strategic Partnerships

Nvidia’s robust performance comes amid heightened expectations for artificial intelligence (AI) technologies. The company recently launched its Vera Rubin AI superchip and is set to host the GTC 2026 event, where major product announcements are anticipated.

Additionally, Nvidia expanded a multiyear deal with Meta to supply both Blackwell and Rubin AI processors. This deal includes the first significant standalone deployment of Nvidia’s Grace CPU servers, illustrating growing demand from major hyperscalers.

Market observers note that hyperscalers such as Amazon, Google, Meta, and Microsoft plan to collectively invest approximately $650 billion in AI infrastructure in the current year, which supports Nvidia’s growth outlook. Gene Munster of Deepwater Asset Management commented that investor sentiment hinges on whether AI growth is just beginning or reaching maturity, stating, "If it’s the second inning, which I believe, Nvidia’s growth outlook over the next several years remains robust."

Mixed Signals from Gaming and Potential Laptop CPU Expansion

Outside the data center, Nvidia reported gaming revenue of $3.7 billion, slightly below estimates of $4 billion. However, the company may strengthen this segment soon with a possible launch of its own laptop CPU.

This upcoming chip would position Nvidia as a competitor to Intel, AMD, and Qualcomm in the laptop market. While gaming CPU revenue may not reach the scale of data center sales, it could solidify Nvidia’s influence with gamers and mobile users interested in gaming-capable laptops.

Stock Performance and Industry Context

Since the beginning of the year, Nvidia’s stock has risen just over 5%, outperforming some peers like AMD and Broadcom but lagging behind Intel, which is up nearly 27%. The mixed stock performance reflects varied investor perspectives on the AI cycle’s maturity and competitive dynamics in semiconductor markets.

Nvidia’s broadening product portfolio, strategic partnerships with leading technology firms, and strong data center business suggest that the company is primed to benefit from ongoing advances in AI and cloud computing infrastructure. The upcoming GTC event and the potential laptop CPU launch may offer further catalysts for growth in the near term.