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Nvidia Corporation (NVDA) experienced a slight decline in its stock during after-hours trading despite reporting first-quarter earnings that exceeded Wall Street expectations. Alongside the earnings results, CFO Colette Kress outlined several significant developments impacting the company.
Hyperscalers Dominate Revenue Streams
Kress disclosed that major cloud providers, known as hyperscalers, such as Amazon, Alphabet, and Microsoft, are responsible for half of Nvidia’s data centre revenue. In the first quarter, hyperscaler revenue rose by 12% to approximately $38 billion. The remaining revenue was attributed to sectors including AI clouds, industrial applications, enterprise solutions, and government projects.
Lack of Revenue from China
A crucial highlight from Nvidia’s update was the absence of any revenue reported from China. The company did not ship its H200 Hopper products to the region during the quarter, which contrasts with the $4.6 billion generated from China in the same quarter of the previous fiscal year. Despite US government approval for certain chip exports, Chinese authorities have discouraged local firms from purchasing these products in a bid to foster domestic chip production. Kress stated that although they have received export licenses, Nvidia has not yet generated revenue from sales to China, and in line with the previous quarter’s outlook, no predictions of revenue from this market are included in their guidance.
Nvidia founder and CEO, Jensen Huang, delivers remarks at the Milken Institute Global Conference on May 4, 2026.
Changes in Earnings Reporting
Nvidia is shifting its earnings reporting framework to enhance investor insight. The new structure will delineate between two main segments: Data Centre, which encompasses activities from major tech firms and dedicated data centres, and Edge Computing, focused on data processing devices used in AI applications, gaming consoles, and automotive technologies. CEO Jensen Huang expressed that this restructuring aims to clarify Nvidia’s diverse business operations, particularly in the evolving landscape of AI.
Increased Cash Returns to Shareholders
Lastly, Nvidia’s board announced a significant increase in the quarterly dividend from $0.01 to $0.25 per share, alongside an $80 billion share buyback initiative. This move has been interpreted as a strategy to align Nvidia with its Big Tech counterparts and attract new investors. Analysts, including Angelo Zino from CFRA Research, noted that enhancing cash returns to shareholders could become a central part of Nvidia’s strategy as the company’s growth rates inevitably moderate.
As investors continue to digest these developments, Nvidia’s ability to navigate the competitive landscape and adapt to market conditions will be vital in maintaining its status as a leader in artificial intelligence and chip technology.
