By Robbie Whelan

Nvidia posted another quarter of record earnings Wednesday, and its shares gained as a forecast of accelerating growth helped calm rising anxiety throughout the market surrounding the viability of the artificial-intelligence trade and fears about overspending on AI infrastructure.

For the quarter ended in July, Nvidia reported record sales of $96.2 billion, or 4% higher than the $92.3 billion analysts polled by FactSet had expected. Net income of $59.7 billion and earnings per share of $2.46 also beat analyst expectations by wide margins.

The crucial data-center segment, which includes most of the AI servers for which Nvidia is best-known, produced sales of $89 billion. Analysts had expected $86.3 billion.

Nvidia's shares gained more than 4% in after-hours trading after Chief Financial Officer Colette Kress, speaking on a call with investors and analysts, said the company expects revenue to grow 70% in 2028.

A flurry of dealmaking activity and product-related news over the past few months has thrust Nvidia, the world's largest publicly traded company and dominant designer of advanced computer chips, even closer to the center of the AI boom.

The $5 trillion tech behemoth earlier this month announced that it would partner with a who's-who of top Wall Street investment firms to provide guarantees for up to $500 billion in data center financing in order to better help its customers afford its chips. Shortly afterward, Nvidia agreed to backstop a massive Ohio data center project by OpenAI that could leave the company on the hook for billions of dollars if plans to lease it fall through.

These and other recent developments-including reports of sharp price increases on Nvidia's servers due to the capacity crunch in memory chips and the chip firm's ambitious investment in designing AI models to fend off China-have raised investors' eyebrows in recent weeks. Nvidia's stock price closed lower for seven straight trading days until the skid ended Tuesday.

"AI has reached its inflection point. It's doing useful work. Its tokens are productive and profitable," said Nvidia Chief Executive Jensen Huang in a statement. "This time last year, one lab alone was driving the buildout; today, we have a golden age of new AI labs and startups, multiple frontier labs scaling in parallel, a thriving open-model ecosystem and physical AI coming online."

Wednesday's report showed Nvidia blowing through analysts' expectations once again, but also underscored how the firm has increasingly become a victim of its own success in the market: big earnings beats alone are no longer enough to drive up the company's share price.

"It felt for a long time like Nvidia was the only company anyone cared about in AI. It was like Atlas, holding up the market on its shoulders," said Will Rhind, founder and CEO of Granite Shares, a manager of exchange-traded funds with $16 billion in assets. "There's not a lot of concern in the market anymore about demand for Nvidia's chips. The bigger questions now are about the broader AI narrative."

Whether or not Nvidia's earnings beat Wall Street's expectations is no longer so important, Rhind said, because the company's shares are no longer "priced to perfection" as they were in previous periods.

Investors are more concerned about the company's guidance for the future on topics such as the schedule of new generations of products and the speed and cost of the AI infrastructure build-out.

Other issues that are top of mind for Nvidia shareholders are whether or not the company will restart sales in China, the rising cost of components such as memory chips and increased competition for its processors from both startups and from Nvidia's own major customers, such as OpenAI and Anthropic, which are working to design their own custom processors suited to their specific respective needs.

Write to Robbie Whelan at robbie.whelan@wsj.com

(END) Dow Jones Newswires

August 26, 2026 17:15 ET (21:15 GMT)