It’s a good time to be the arms dealer for the AI boom

Summary

Nvidia delivered blockbuster third-quarter results that underscore its central role in the AI infrastructure boom. The company reported $57 billion in revenue (up 62% year‑on‑year) and an exceptional GAAP gross margin of 73.4%. The data centre business drove the performance, generating $51.2 billion — a 66% increase from a year ago — as demand for GPUs (including the Blackwell family) outstrips supply and cloud GPUs are reported sold out.

CEO Jensen Huang dismissed talk of an “AI bubble” during the earnings call and pointed to continued GPU demand as AI workloads shift away from CPUs. However, investors and commentators have raised questions about customer accounting (notably depreciation schedules for GPUs) and the circular economics of large vendor-hyperscaler deals. Nvidia has signalled aggressive product cadence (moving from a two‑year to a one‑year rhythm) and disclosed letters of intent and conditional investment agreements with AI players such as OpenAI and Anthropic, with caveats in its 10‑Q filing about the conditional nature of these deals.

Key Points

Nvidia reported $57bn revenue in Q3 FY2026 — up 62% versus a year earlier, with a GAAP gross margin of 73.4%.
Data centre sales were $51.2bn, rising 66% year‑on‑year; Blackwell GPU demand is described as “off the charts” and cloud GPUs are sold out.
CEO Jensen Huang rejects the notion of an AI bubble; Nvidia sees sustained demand as AI workloads migrate to GPUs.
Investor concerns persist: high-profile stock sales (e.g. Peter Thiel, SoftBank) and worries about customers understating GPU depreciation.
Nvidia is accelerating its product cadence (one‑year rhythm), which argues against long depreciation schedules for GPUs.
The company has conditional investment arrangements with major AI firms (OpenAI intent previously announced; up to $10bn agreement with Anthropic noted), but filings stress those deals are subject to closing conditions.

Author style

Punchy: This is a big one. Nvidia isn’t just benefiting from AI — it’s actively shaping the economics of the industry. If you follow AI infrastructure, cloud suppliers, or enterprise IT spend, the nuts and bolts of this report matter: it explains where budgets are flowing and why the market structure keeps tilting in Nvidia’s favour.

Why should I read this?

Want the short version? Nvidia is still raking it in — GPUs are scarce, customers are buying big, and margins are absurdly high. If you care about where AI money goes, which vendors win, or whether the “AI bubble” is real, this is worth five minutes. We’ve cut the waffle: big numbers, big demand, and a few accounting caveats that could bite some customers later.

Source

Source: https://go.theregister.com/feed/www.theregister.com/2025/11/19/nvidia_earnings_q3_2025/