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NVIDIA's Data Center Crosses $75B Mark: Can Growth Stay Strong Ahead?
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Key Takeaways
NVIDIA's Q1 Data Center revenues rose 92% YoY to $75.25B and accounted for over 92% of total revenues.
NVIDIA's Blackwell demand powered hyperscale revenues up 115% YoY, while AICE revenues surged 74%.
NVDA expects Q2 revenues up 95% YoY and 22% sequentially to roughly $91B, signaling momentum remains intact.
NVIDIA Corporation (NVDA - Free Report) continued its explosive artificial intelligence (AI)-driven run in the first quarter of fiscal 2027, with Data Center market platform revenues climbing to a record $75.25 billion, up 92% year over year and 21% sequentially. The segment now contributes more than 92% of total revenues, showing how deeply NVIDIA is tied to the global AI infrastructure boom.
The strong growth was fueled by surging demand for the company’s Blackwell platform, which is being deployed by major hyperscalers, cloud providers and frontier AI model developers. Within Data Center, Hyperscale revenues soared 115% year over year and 12% sequentially to $37.87 billion.
Another positive sign is the diversification of NVIDIA’s customer base. The company’s AI Clouds, Industrial and Enterprise business, a part of its broader Data Center market platform, generated $37.4 billion in revenues, up 74% year over year and 31% sequentially. Sovereign AI projects and enterprise AI deployments are becoming key growth drivers beyond large cloud customers.
NVIDIA’s first-quarter performance also benefited from rising networking sales, with Data Center networking revenues surging 199% year over year and 35% sequentially to $14.8 billion. Demand for InfiniBand, Spectrum-X Ethernet and NVLink solutions remained strong as companies expanded AI factory capacity worldwide.
NVIDIA expects second-quarter revenues to increase 95% year over year and 22% sequentially to reach roughly $91 billion, suggesting growth momentum remains intact. NVIDIA also sees long-term AI infrastructure spending reaching trillions of dollars by the end of the decade as agentic AI adoption accelerates. These projections suggest sustained growth momentum across the company’s Data Center market platform. The Zacks Consensus Estimate for Data Center fiscal 2027 revenues is currently pegged at $363.78 billion, indicating a year-over-year increase of approximately 88%.
How NVIDIA’s Rivals Fare in AI Data Center Space
Advanced Micro Devices, Inc. (AMD - Free Report) and Intel Corporation (INTC - Free Report) are two major companies that are competing closely with NVIDIA in the AI data center space.
Advanced Micro Devices is gaining traction with its MI300 series accelerators, which are designed to handle training and inference for large AI models. AMD’s chips have attracted interest from major cloud providers seeking diversification beyond NVIDIA’s ecosystem. While Advanced Micro Devices’ software stack is still developing, its performance and pricing advantages make it a credible alternative. The company’s Data Center revenues surged 57.2% year over year to a record $5.78 billion in the first quarter of 2026, underscoring the scale of the company’s AI-driven momentum.
Intel is also reasserting its presence with the Gaudi series of AI accelerators. The company is positioning Gaudi3 as a cost-effective and scalable option for AI data centers, targeting enterprise clients looking for flexibility. Intel’s broad reach in CPUs and server infrastructure helps it integrate AI solutions more easily into existing systems. INTC’s data center and AI Group revenues soared 22% to $5.05 billion in the first quarter of 2026.
NVIDIA’s Price Performance, Valuation and Estimates
Shares of NVIDIA have surged around 59.1% over the past year compared with the Zacks Computer and Technology sector’s gain of 50.3%.
NVIDIA One-Year Price Return Performance
Image Source: Zacks Investment Research
From a valuation standpoint, NVDA trades at a forward price-to-earnings ratio of 23.14, below the sector’s average of 25.64.
NVIDIA Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NVIDIA’s fiscal 2027 and 2028 earnings implies a year-over-year increase of approximately 74.4% and 36.6%, respectively. Estimates for fiscal 2027 and 2028 have been revised upward over the past seven days.
View the Zacks #1 Rank List
Image: Bigstock
NVIDIA's Data Center Crosses $75B Mark: Can Growth Stay Strong Ahead?
Key Takeaways
NVIDIA Corporation (NVDA - Free Report) continued its explosive artificial intelligence (AI)-driven run in the first quarter of fiscal 2027, with Data Center market platform revenues climbing to a record $75.25 billion, up 92% year over year and 21% sequentially. The segment now contributes more than 92% of total revenues, showing how deeply NVIDIA is tied to the global AI infrastructure boom.
The strong growth was fueled by surging demand for the company’s Blackwell platform, which is being deployed by major hyperscalers, cloud providers and frontier AI model developers. Within Data Center, Hyperscale revenues soared 115% year over year and 12% sequentially to $37.87 billion.
Another positive sign is the diversification of NVIDIA’s customer base. The company’s AI Clouds, Industrial and Enterprise business, a part of its broader Data Center market platform, generated $37.4 billion in revenues, up 74% year over year and 31% sequentially. Sovereign AI projects and enterprise AI deployments are becoming key growth drivers beyond large cloud customers.
NVIDIA’s first-quarter performance also benefited from rising networking sales, with Data Center networking revenues surging 199% year over year and 35% sequentially to $14.8 billion. Demand for InfiniBand, Spectrum-X Ethernet and NVLink solutions remained strong as companies expanded AI factory capacity worldwide.
NVIDIA expects second-quarter revenues to increase 95% year over year and 22% sequentially to reach roughly $91 billion, suggesting growth momentum remains intact. NVIDIA also sees long-term AI infrastructure spending reaching trillions of dollars by the end of the decade as agentic AI adoption accelerates. These projections suggest sustained growth momentum across the company’s Data Center market platform. The Zacks Consensus Estimate for Data Center fiscal 2027 revenues is currently pegged at $363.78 billion, indicating a year-over-year increase of approximately 88%.
How NVIDIA’s Rivals Fare in AI Data Center Space
Advanced Micro Devices, Inc. (AMD - Free Report) and Intel Corporation (INTC - Free Report) are two major companies that are competing closely with NVIDIA in the AI data center space.
Advanced Micro Devices is gaining traction with its MI300 series accelerators, which are designed to handle training and inference for large AI models. AMD’s chips have attracted interest from major cloud providers seeking diversification beyond NVIDIA’s ecosystem. While Advanced Micro Devices’ software stack is still developing, its performance and pricing advantages make it a credible alternative. The company’s Data Center revenues surged 57.2% year over year to a record $5.78 billion in the first quarter of 2026, underscoring the scale of the company’s AI-driven momentum.
Intel is also reasserting its presence with the Gaudi series of AI accelerators. The company is positioning Gaudi3 as a cost-effective and scalable option for AI data centers, targeting enterprise clients looking for flexibility. Intel’s broad reach in CPUs and server infrastructure helps it integrate AI solutions more easily into existing systems. INTC’s data center and AI Group revenues soared 22% to $5.05 billion in the first quarter of 2026.
NVIDIA’s Price Performance, Valuation and Estimates
Shares of NVIDIA have surged around 59.1% over the past year compared with the Zacks Computer and Technology sector’s gain of 50.3%.
NVIDIA One-Year Price Return Performance
Image Source: Zacks Investment Research
From a valuation standpoint, NVDA trades at a forward price-to-earnings ratio of 23.14, below the sector’s average of 25.64.
NVIDIA Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for NVIDIA’s fiscal 2027 and 2028 earnings implies a year-over-year increase of approximately 74.4% and 36.6%, respectively. Estimates for fiscal 2027 and 2028 have been revised upward over the past seven days.
Image Source: Zacks Investment Research
NVIDIA currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.