NVIDIA's next earnings report is about to be released, and one of the most closely watched figures by the market is the company's previously provided guidance of $108 billion in quarterly revenue.
What does this figure mean? If NVIDIA demonstrates revenue growth beyond expectations again, will the stock price strengthen? If revenue meets the target, but the gross margin declines, how will the market price it?
BiyaPay data shows that as of the market close on November 10, Eastern Time, NVIDIA (NVDA) was at $168.89, down 5.47%. From $186.64 on November 6 to $168.89 on November 10, the total pullback over the two trading days was approximately 9.51%. In the context of continuous stock price adjustments and a cautious market sentiment, the next earnings report will not only be a performance disclosure but will also become an important point for the market to reassess the profitability of the AI leader.
$108 billion revenue guidance, can NVIDIA's growth continue?
NVIDIA achieved revenue of $96.221 billion in the second quarter of fiscal year 2027, marking a 106% year-over-year increase and an 18% quarter-over-quarter increase. Among this, revenue from the data center business was approximately $89 billion, a year-over-year increase of 117%, continuing to be the company's most important growth engine.
During the same period, the company reported a GAAP gross margin of 75%, with a non-GAAP gross margin also at 75%. In terms of revenue scale and profitability, NVIDIA remains in a high growth stage. More importantly, the company provided guidance for the third quarter, forecasting revenue of $108 billion, with a fluctuation range of 2%.
Based on this guidance, the revenue range is approximately $105.84 billion to $110.16 billion. If calculated using the median of $108 billion, this represents a quarter-over-quarter growth of about 12.2% compared to the previous quarter's $96.221 billion. This implies that the company expects to achieve significant revenue growth again in the next quarter.
However, there is a point that can easily cause confusion: the $108 billion is NVIDIA's guidance for company revenue, not revenue that has already been realized, nor is it the consensus expectation of analysts. Investors need to compare the company's guidance, market consensus expectations, and the final actual performance separately.
Why is this distinction important?
Because stock prices trade on expectations. If the market originally expected NVIDIA to achieve $108 billion, then even if the actual revenue meets this number, it might not be enough to drive the stock price up. Conversely, if the market has higher expectations, and the actual performance reaches the guiding median but does not exceed market expectations, the stock price might also come under pressure.
For investors focusing on U.S. technology stocks, aside from earnings analysis, preparing trading funds is also worth considering in advance. BiyaPay supports trading in U.S. and Hong Kong stocks, allowing conversion of USDT to U.S. dollars or Hong Kong dollars before participating in the corresponding market, or directly recharging in USD for U.S. stock trading. Within a single account system, currency exchange connects with securities trading, reducing switches between different platforms.
Therefore, determining whether this earnings report is positive cannot solely rely on the $108 billion figure; rather, it requires assessing where the actual performance stands relative to market expectations.
Continued revenue growth, can the gross margin be maintained?
If revenue reflects NVIDIA's business scale, then gross margin better reflects the company's profitability and pricing power.
NVIDIA's previous quarter GAAP gross margin was 75%. However, in the company's outlook for the third quarter, both GAAP and non-GAAP gross margins are projected to be 74%, fluctuating by 50 basis points, roughly between 73.5% and 74.5%.
This means the company expects the gross margin to potentially decline somewhat compared to the previous quarter.
Why is the market paying attention to this change?
Firstly, NVIDIA's product structure is constantly changing. As the new generation of products and system-level solutions gradually advance, product mix, manufacturing costs, supply chains, and system delivery methods may all affect the gross margin.
Secondly, competition may also affect pricing power. When customers have more chip suppliers and self-developed solutions, vendors need to continuously prove their performance, efficiency, and overall cost advantages.
Thirdly, building AI infrastructure is becoming increasingly complex. Customers are purchasing not just single GPUs but also CPUs, networks, cabinets, and entire systems. Changes in the sales structure of different products may impact the overall profit margin.
We can make a simple calculation: if NVIDIA's revenue in the third quarter reaches $108 billion, then every 1 percentage point change in gross margin corresponds to a difference of approximately $1.08 billion in gross profit.
This is merely a static calculation, not an actual profit forecast, but it is enough to illustrate how important gross margin is for a large company like NVIDIA.
What investors need to closely observe is whether the decline in gross margin is a temporary impact caused by new products and changes in product mix, or whether intensifying competition and rising costs are beginning to erode profit margins.
If revenue growth remains strong and gross margins only fluctuate slightly, the market may be more accepting; if revenue growth slows while gross margins continue to decline, the market might reassess NVIDIA's future profitability elasticity.
AI demand remains strong, but can computational investments truly convert into profits?
NVIDIA's growth over the past few years has been fueled by large tech companies continuously constructing AI data centers.
Initially, the market was more concerned with how many GPUs were needed for large model training and the scale of clusters required. As AI applications gradually enter enterprise business, inference demand, AI agents, and long-running complex tasks have also begun to emerge as new sources of computational demand.
NVIDIA continues to lay out in this direction.
In the performance disclosure for the second quarter of fiscal year 2027, the company mentioned that the Vera Rubin platform is entering the full-scale production stage and disclosed the deployment progress with relevant partners. Meanwhile, the company launched the Vera CPU aimed at AI agents and continues to expand network, storage, and system-level products.
This indicates that NVIDIA aims to provide not just GPUs for training models but a complete computing platform covering training, inference, agents, and data center infrastructure.
However, investors need to note that entering the production phase does not equal that all customers have completed deployment, nor does it mean that related revenue has all been realized. The timeline from production to delivery, and then to customer deployment and revenue recognition still requires time.
What is truly worth noting here is the business return on AI investments.
Large cloud service providers continuing to invest in data centers will certainly generate demand for chips and infrastructure. However, customers ultimately need to obtain revenue through cloud computing services, model calls, and enterprise AI applications to support the next round of investment.
If AI applications continue to grow and enterprises are willing to pay for computational power, cloud service providers will have the incentive to continue expanding data centers; if the utilization of computational power is insufficient or revenue from AI services cannot cover investments, customers may adjust their capital expenditure plans.
Therefore, investors cannot simply look at how hot the AI industry is but also need to assess whether customers are willing to continue paying, and whether computational investments can yield stable business returns.
Earnings reports should not only consider revenue, but also cash flow and operating quality
For a high-growth company like NVIDIA, revenue and gross margin are only part of the analysis.
I believe this earnings report should also focus on three operational indicators.
First, accounts receivable and payment status
Revenue growth does not equate to cash being recognized. As the business scales up, changes in customer payment cycles, accounts receivable, and the actual collection status are all worth observing alongside revenue growth rates.
If accounts receivable are growing significantly faster than revenue while revenue is increasing, it is necessary to further understand the customer structure, payment cycles, and revenue recognition situation.
This does not mean that an increase in accounts receivable necessarily indicates a problem, but it is an important auxiliary indicator for assessing revenue quality.
Second, inventory changes
The chip industry involves product iterations, supply chain stocking, and delivery cycles. An increase in inventory may be to meet future orders or may be related to product structure adjustments and changes in delivery pace.
Thus, one cannot interpret an increase in inventory as strictly negative, nor can one completely ignore changes in inventory. A comprehensive judgment needs to be made in conjunction with orders, delivery, and subsequent revenue situations.
Third, operating cash flow
Whether profits can ultimately be converted into cash flow is a critical standard for assessing the company's operational quality.
If revenue, profit, and operating cash flow all grow synchronously, it indicates that the quality of the company's growth is relatively supported; if profit grows rapidly but cash flow performance lags significantly, further analysis of the underlying reasons is required.
For investors, earnings report analysis cannot simply chase a beautiful revenue number; more importantly, it is to confirm whether growth can be sustained, whether profits can be realized, and whether cash can truly be collected.
Is a good earnings report guaranteed to lead to an increase in stock price?
The answer is not necessarily.
This is one of the most common misconceptions during earnings season.
Many investors tend to categorize earnings reports into two types: exceeding expectations is a positive signal, falling short is a negative signal. However, for a company like NVIDIA, which is highly focused upon in the market and whose future growth expectations have been thoroughly discussed, stock price responses are often more complex.
For example:
If NVIDIA's actual revenue reaches $108 billion but the market had already expected the company could achieve or even exceed this level, then after the earnings report is released, investors might believe the good news has already been priced into the stock.
If revenue meets expectations but the gross margin is below market expectations, or if guidance for the next quarter has not been raised, the stock price may also see adjustments.
Conversely, even if a certain indicator slightly underperforms the most optimistic market predictions, as long as the company's follow-up outlook is sufficiently positive, the market may also reevaluate future growth potential.
Therefore, post-earnings release stock price performance depends on the disparity between actual data and market expectations, and not solely on the company’s operating data itself.
Additionally, NVIDIA is currently facing uncertainties related to management investigations. Operational data and governance events belong to two different dimensions; one cannot substitute a beautiful earnings report for a judgment on the investigation progress, nor can one overlook the company's actual operational performance due to short-term events.
Announcement time of the earnings report and key points for investors to focus on next
NVIDIA is scheduled to announce its earnings for the third quarter of fiscal year 2027 on November 17, Eastern Time. According to the company's arrangements, the earnings report is expected to be released around 1:20 PM on the same day, with a conference call anticipated to take place around 2:00 PM, corresponding to approximately 5:20 AM and 6:00 AM Beijing time on November 18.
After the earnings announcement, several questions can be closely monitored:
• Did actual revenue reach the $108 billion guidance range, and how does it compare to market consensus expectations?
• Is the data center business continuing to grow, and is the source of growth becoming more diversified?
• Is the GAAP gross margin within the previously provided range of 73.5% to 74.5%?
• Does guidance for revenue and gross margin for the next quarter maintain a growth trend?
• Are accounts receivable, inventory, and operating cash flow matching business expansion?
• How does management explain AI demand, customer capital expenditures, and the progress of new product deliveries?
For users following the U.S. stock market through BiyaPay, it is also possible to prepare in advance for the types of trades supported by the account, USD fund arrangements, and related fees prior to the earnings report. BiyaPay supports the exchange of digital assets with USD and HKD, providing qualified users with corresponding fund exchange and trading paths. Specific operations still need to be based on the actual support scope and account rules of the platform.
$108 billion is just the starting point; the quality of growth is key
NVIDIA's guidance of $108 billion in revenue indicates that the company still expects to continue expanding its business scale. However, for investors, this number is not the complete answer to determining the company's value.
What truly decides how the market will reprice NVIDIA is whether revenue can be realized, whether gross margin can remain competitive, whether investments in AI infrastructure can be converted into sustainable revenue, and whether profits can ultimately be turned into cash flow.
Before the earnings report is released, the market trades on expectations; after the earnings report is released, investors need to confront actual data.
For NVIDIA, the market has witnessed its rapid growth over the past few years. The more important question for the next stage is: amidst intensifying competition, expanding capital expenditures, and heightened valuation requirements, can it continue to deliver sufficiently convincing profitability performance?
This is the matter behind the $108 billion guidance that truly deserves investors' attention.
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