Nvidia Guides 78 Billion Quarter, Repricing Chip Stocks And Rates

Nvidia Beat On Results Lifts Near-Term Baseline For Growth

Nvidia reported fiscal fourth-quarter results after the market close on February 25, 2026, posting record revenue of $68.1 billion for the period ended January 25, 2026. Non-GAAP earnings were $1.62 per diluted share and GAAP earnings were $1.76, while net income was $42.96 billion. Management guides the next quarter with revenue expected at 78 billion dollars, plus or minus 2%, a level that pushed late trading toward $200 after a close near $195.56.

The guidance is repricing assumptions for chip stocks because it signals that data center demand is still absorbing supply at scale. Rates are sensitive to the same message, since a longer capex cycle can keep growth expectations firmer and extend the duration trade in mega-cap technology.

Data Center Revenue Dominates, With China Left Out Of The Guide

Data center revenue was $62.3 billion, up 22% from the prior quarter and up 75% from a year earlier, or about 91% of total sales. For the full fiscal year, data center revenue reached $193.7 billion, up 68%, concentrating the earnings narrative on hyperscaler buildouts and enterprise deployments.

For the first-quarter revenue outlook, the company said it is not assuming any data center compute revenue from China. That keeps policy risk in focus, because export-control shifts can alter regional mix and influence which customers get priority supply.

Gross Margin Near 75% Supports Pricing Power

Fourth-quarter GAAP gross margin was 75.0% and non-GAAP gross margin was 75.2%. The first-quarter gross margin outlook is 74.9% GAAP and 75.0% non-GAAP, plus or minus 50 basis points, suggesting that higher system content has not forced a major margin reset.

Stable margins matter for equity valuation and for how investors price operating leverage, especially if competitors push price-performance claims and customers evaluate total cost of ownership per workload.

Stock-Based Compensation Moves Into Non-GAAP Measures

Starting in the first quarter of fiscal 2027, Nvidia will include stock-based compensation in non-GAAP metrics. The company expects stock-based compensation to add about $1.9 billion to first-quarter non-GAAP operating expenses, within an operating expense outlook of about $7.7 billion GAAP and $7.5 billion non-GAAP.

This accounting change does not move cash, but it changes the clean comparability of non-GAAP trends versus earlier quarters. It also affects how investors model expense discipline when revenue growth inevitably normalizes.

Capital Returns Remain Large, With $58.5 Billion Authorization Left

During fiscal 2026, Nvidia returned $41.1 billion to shareholders through repurchases and dividends, and it ended the quarter with $58.5 billion remaining under its share repurchase authorization. The next quarterly dividend is $0.01 per share, payable April 1, 2026 to shareholders of record on March 11.

A larger buyback capacity can lift support levels for the stock, but it also raises expectations for continued free cash generation through 2026, when supply commitments and packaging capacity remain binding constraints.

Spillovers To Hardware, Power Infrastructure, And Metals

A 78 billion revenue guide implies heavy shipment volumes into the April quarter, a positive read-through for suppliers tied to advanced packaging, high-bandwidth memory, networking, and power delivery. It can also lift demand expectations for cooling, switchgear, and transformers as rack density rises.

Those infrastructure needs spill into commodities via copper and aluminum usage in data centers and grid connections, creating a channel from Nvidia demand signals to industrial input pricing.

Rates, Credit, And FX React Through Risk Sentiment

If investors treat the guide as confirmation of sustained investment, longer-dated yields can drift higher on stronger growth expectations. If volatility rises and positioning unwinds, rates can still rally as a hedge, creating two-way risk around the same earnings catalyst.

In credit, stronger cash flow visibility can tighten spreads for large suppliers, while smaller ecosystem names can face wider dispersion if customer concentration becomes a concern. In FX, risk-on sessions tend to weaken the dollar, while policy uncertainty around China can strengthen the dollar and yen.

Tredu Scenarios Put Markets In Focus Into March

Base case: guidance execution holds and gross margin stays near 75%, keeping chip stocks supported while rates trade sideways. Trigger: shipment commentary aligns with the 78 billion guide and operating expenses track the new non-GAAP framework.

Upside scenario: supply loosens faster than expected and demand outside China accelerates, lifting forward revenue expectations and pushing rates higher on a stronger growth impulse. Trigger: faster rack deployments and improved lead times.

Downside scenario: margin lands near the low end of guidance and expense optics tighten as stock-based compensation is included, pressuring valuation multiples and driving a defensive bid in rates. Trigger: customer digestion, export-control friction, or delayed deployments.