Hi everyone. This is the follow-up post to last week’s Full Estimates article and will provide my finalized numbers for Q1. I will briefly explain the reason for each change without repeating too much from last week.

Top Level:

I am adjusting my revenue estimate down by $0.10 billion, from $80.93 billion to $80.83 billion.

This is the result of a $0.1 billion decrease in Gaming ($3.50 billion from $3.60 billion) and a ~$0.75 billion increase in other expenses, inclusive of tax. I am not adjusting my estimate for gross margins or shares outstanding.

The result of these changes on EPS is -$0.04 to $1.85 per share.

Changes Explained:

Gaming revenue from industry peers has been largely disappointing, with AMD reporting solid figures but guiding for a large downturn next quarter. MSFT reported weak hardware numbers and echoed $AMD’s outlook. $NVDA’s fiscal quarter ends later, and is likely to see a larger impact in the current quarter.

In regards to other expenses, unusually high other income in Q4 was overweighted when calculating Q1 figures. The estimated tax payment inched up slightly as well, totaling $0.75 in additional expense. The combination of these factors negatively impacted EPS by $0.04 (rounded).

Consolidated Final Estimates:

• Revenue: $80.83 billion
• EPS: $1.85
• Q1 Gross Margin: 75.1%
• Q2 Revenue Guide: $93 billion +/- 2%
• Q2 Margin Guide: 75% +/- 0.5%

Comparison Visualized:

https://preview.redd.it/l19bw5udap1h1.png?width=610&format=png&auto=webp&s=9a5f8abe4b9ebbf95b546f1d0c3b8cc7148a5a4a

Some figures in the Analyst Consensus column are estimates based on known EPS and Total Revenue forecasts. The math ties out, and the consensus is an average, so using an example comparison with segment data is fair.

Updated Analyst Estimates:

Multiple firms raised their PT and earnings estimates for NVDA last week. This means that the consensus I use to compare against has increased. I will continue to monitor the latest aggregated consensus numbers for EPS, Revenue, and Guidance leading up to the report. Please note that I use the average estimate from Yahoo Finance data.

https://preview.redd.it/sxpzbh6jap1h1.png?width=768&format=png&auto=webp&s=a5537a1c981efef7e6d6a66c07e488e2dcf4e6aa

As of today, 42 Analysts expect an average of $79.17 billion in Q1 revenue, 39 analysts expect average EPS around $1.78, and 40 analysts expect an average of $87.03 billion in Q2 revenue.

Positions Update:

In the full estimates post, I noted my intention to leg in and out of call debit spreads while attempting to collect premium for each spread. This has largely worked so far, with the portfolio currently holding two $150/$200 spreads, one $175/$185 spread, and one $180/$185 spread. In total, I was paid a $3.56 premium to open these positions and will make a max gain of $118.56 premium if all options expire ITM.

Current \"Free\" Positions

The next NVDA post will come after Q1 Results and compare how the print stacked up to my and the street's estimates. Thank you for reading this far, and I am happy to answer any questions about the updates in the comments.

TL;DR at the Bottom -- Believe it or not this is already edited down

Happy Mother’s Day, everyone. This is the follow-up to my first estimates post, where I will walk through the updated forecast in detail. It is broken out into the following sections:

• Revenue: Segment-level analysis for all revenue sources
• Earnings: Top-down calculation from Revenue to headline EPS
• Guidance: Q1 and Full-year FY27 Guidance Analysis
• Limitations of Analysis: Acknowledgement of assumptions and public data use
• Valuation: Discussion of Price Targets via various valuation methods
• Positioning: Disclosures related to my holdings

Data Center Revenue:

Quarterly DC Revenue and QoQ Growth Rate Past 12 Quarters by Calendar

Last quarter, Data Centers represented $62.31 billion of the company’s $68.13 billion in total revenue (91.46%). This figure has been increasing gradually over the last eight quarters, averaging around 89% over that period. I expect this percentage to continue to increase as Data Center revenue remains strong and the company advises weakness in Gaming, the second-largest revenue segment.

Despite the caution around Gaming, $NVDA guided total revenue to be $78 billion, +/- 2%, surpassing my expectation of $76 billion. In my Q4 FY26 estimates post, I had Data Center revenue for the current quarter around $71 billion, with around $5 billion coming from the remaining segments.

Since then, many semiconductor peers have reported stellar earnings on insatiable demand. $AMD’s Data Center Revenue grew 57% YoY, up from 39.4% in Q4. The graph below shows the high degree of correlation between YoY growth rates for AMD and NVDA:

AMD's DC Segment Suggests Re-acceleration for $NVDA

This quarter will benefit from full-scale Blackwell production, with anticipation of updates on the status of Vera Rubin shipments. Investors are also looking for information on reentry to the Chinese market. H200 negotiations have seemingly stalled, but investors are hopeful that autonomous driving solutions could provide a way back into a large market that is currently inaccessible.

While I expect the slight moderation in QoQ growth seen in Q4 to continue into Q1, higher-than-expected CapEx from key customers and increased efficiency push my estimate above 20% sequential growth.

Q4 Data Center Estimate: $75.00 billion

Gaming Revenue:

Colette Kress stated in her CFO commentary, “We expect supply constraints to be a headwind to Gaming in the first quarter of fiscal 2027 and beyond.”

The segment did not perform well in Q4, either. Revenue of $3.73 billion fell short of my expectations ($4.10B), and declined 13% QoQ. While Gaming has been highly volatile in recent quarters, I expect another subdued quarter as Switch2 sales plateau, and the console cycle matures another year. The company is also purposefully allocating resources to its more profitable and growing Data Center segment, which caps growth in Gaming.

Historical, Q1, and Guided Gaming Revenue by Calendar Q

As Gaming’s share of total revenue decreases due to the AI arms race, the variance between estimates and actuals becomes less impactful on the headline numbers. Data Center revenue is the main focus, while the next segment covered exploded last quarter and could provide a meaningful boost in Q1.

Q1 Gaming Estimate: $3.60 billion

Prof. Visualization, Robotics & Auto, and Other Revenue:

I have previously lumped each of these remaining segments into one section due to their limited size compared to Data Center and Gaming. However, Professional Visualization revenue surged 74% QoQ and 159% YoY to over $1.3 billion due to “exceptional demand for Blackwell.”

With that being the only CFO commentary and continued demand for Blackwell, we have little additional information on how this segment will scale. My estimate includes the expectation of normalization mostly due to low information.

Jensen’s commentary on Robotics and Auto would lead the public to believe the surge seen in Prof. Visualization is due in this segment any quarter now. The actual story is a bit more bleak, and growth and segment revenue are both minimal for now. The Other Revenues segment has been relatively stable and is categorized by specialized products and non-standard items like Intellectual Property, and is by far the smallest revenue segment.

Q1 Prof. Visualization Estimate: $1.50 billion
Q4 Robotics and Auto Estimate: $0.65 billion
Q4 Other Revenue Estimate: $0.18 billion

Total Revenue Estimate:

• Q1 FY27 Revenue of $80.93 Billion vs ~$78.79 Billion est.
• Q2 FY27 Revenue Guidance of $93.50 Billion vs $86.64 Billion est.

Performance History Last 5 Quarters, Avg Error Remains <2%

Earnings Estimate:

Now that we have the Total Revenue estimate of $80.93 billion, we must estimate gross margin, operating expenses, total shares outstanding, and any other costs/income, which I lump into “non-operating expenses.” It is also important to note that this is the first quarter that NVDA will include Stock-Based Compensation in Non-GAAP reporting. This is expected to cause a negative impact of $1.9 billion in Q1 (~$0.07 EPS).

NVDA’s company-issued guidance for both gross margin and operating expenses has been largely reliable in recent quarters. In Q1, the company expects a gross margin of 75% (+/- 0.5%) and Non-GAAP operating costs of $7.5 billion (includes SBC). This analysis uses 75.1% and $7.4 billion, which is more or less in line with the company’s guidance. Gross margin is slightly higher due to apparent pricing power and management’s push for “mid 70s margins.”

In this analysis, non-operating expenses are the total difference between Non-GAAP Operating and Non-GAAP Net income. For NVDA, this is essentially net other income/expense (Company omitted guide in Q1), net interest gained or paid (usually near breakeven), and their tax bill (guided 17% - 19% in FY27).

The company recently expanded its share repurchase program with an additional $60 billion authorization on Q2 FY26’s earnings announcement and still has $58.5 billion remaining. The Company ended last quarter with 24.432 billion shares used to calculate EPS.

Q4 was a weak quarter for share repurchases, with $3.815 billion. NVDA has been slowing repurchases as the company invests in its business. While the company ended Q1 with a record $62.56 billion in cash, it has continued investing aggressively in the quarter. It is also difficult to estimate the average share price paid by NVDA on these buys.

Based on the average stock price during the quarter and an estimated spend of $5-7 billion on share repurchases in Q1, my share count estimate drops by ~35 million shares to 24.397 billion shares.

Earnings \"Walk\" From Top Line Revenue to Bottom Line Profits, Includes SBC

I end up with $1.89 EPS on $80.93 billion of revenue, outpacing the analyst consensus of $1.77 on $78.79 billion. The delta between EPS calculations is disproportionate compared to revenue, suggesting analysts see a lower gross margin or higher expenses. Analysts may be split on how SBC will impact EPS, or expect a margin dip as the Vera Rubin ramp begins. The consensus for revenue guidance is historically conservative, whereas I have a more optimistic calculation in this area as well.

Guidance:

After a strong rebound in Q3, sequential growth slowed slightly in Q4. Analysts expect this decline to continue in Q1, and drop to single-digit QoQ growth in Q2 FY27. This is slightly more optimistic than the ~8% sequential guidance estimate from last quarter, but still short of my expectations.

My guidance estimate is much more optimistic, as the typical cyclical downturn related to product upgrades should be offset by continued demand. Strong growth from the Data Center segment is the main variance driver for total revenue estimates.

Current Estimate for Q1 & Q2 FY27 Total Revenue and Growth Rates

The $8 billion guidance delta is up from $5 billion in Q4, when the company surpassed even my elevated estimate. I hypothesized that the guidance surprise could serve as a positive catalyst, but the post-earnings rally was short-lived.

Limitations:

While this analysis is the most in-depth review of $NVDA’s earnings available from non-professional sources, my forecasts rely heavily on publicly available information such as historical and industry peer earnings releases, macroeconomic data, company guidance, and educated assumptions to calculate estimates.

I have taken measures to prevent including too many assumptions, as output quality is directly correlated to input quality. Having five previous quarters of experience forecasting $NVDA’s earnings has helped fine-tune the model; however, without perfect information, variance is inevitable.

Valuation:

As of the time of writing, the midpoint EPS expectation for FY27 is ~$8.43 per share. This is up from $7.75 during the Q4 cycle, but still short of my expectation of ~$9.05 per share this calendar year.

While current quarter and year estimates are relatively tightly distributed, a wider divergence appears when projecting further into the future. Uncertainty increases with time, but NVDA’s specific future is more questioned than most Mag7 companies.

It is my opinion that the current valuation is pricing in this uncertainty, and increasingly so as companies like AMD and Broadcom show CPU demand could be stealing market share. I do not share the belief that growth will cool anytime soon, as a main reason customers are exploring alternatives is the inability to get on NVDA’s books.

International trade has been another damper on the company’s growth and valuation. Losing access to the Chinese market has been a significant blow, and as the company has planned large expansions in the Middle East, it is left navigating a difficult environment.

While earnings have not been a consistent positive catalyst in recent history, another impressive quarter from the company could signal that it is not time to worry about CPUs yet, and provide the catalyst to solidify breaking the range. Explicit negative commentary on supply, China, or the Middle East could cause selling pressure.

Positions:

As of today’s post, I have continued to manage my positioning. The stock is starting to break its longstanding range-bound trading, and I expect a positive surprise, more than the usual “beat and raise.” On March 24th, 2026, I purchased a $150 strike call option expiring in December of 2028 for $70 in premium. $NVDA was trading for ~$175 at the time of purchase, resulting in short-term gains. On April 22nd, with the stock trading at ~$202, I purchased an additional $150C for $88.50 in premium.

Current LEAPS Holdings, Current strategy is related to PMCCs

On May 8th, 2026, the stock was trading above $215 per share, and I decided to sell a $200C for the same expiry to receive $77 premium in credit. This effectively turns the first $150C into a $50 Call Debit Spread, except I received a credit of $7 premium. I will make $7 premium if the stock is below $150 at the end of 2028, while I will make $57 premium if the stock is trading above $200.

Going forward, the plan is to purchase additional $150Cs using the premium collected from selling the $200C while creating “free” spreads. This allows for delta expansion while still managing risk associated with time-decaying option contracts.

Next week’s post will be more concise and only cover the changes from this estimate and the reasoning behind the adjustment. The final post in the Q1 earnings cycle will follow NVDA’s earnings announcement and review results and variance to forecasts. While these are the final scheduled posts, I will continue to post updates as relevant information related to earnings becomes public. Thank you for reading. I am a human, and this is not financial advice.

TL;DR

• $1.89 EPS on $80.93B Rev, Strong Beat
• Blowout Guidance, FY27 EPS Upward Revisions
• Valuation is Pricing in CPU Alternatives
• LEAPS at $150 Strike, Legging in and out of Spreads

Hi everyone. This post is meant to discuss key insights for $NVDA from last week's Big Tech earnings.

Relevant Stocks Covered:

1. $MSFT
2. $META
3. $AMZN
4. $TSLA (Not Last Week, but Relevant)

$MSFT:

• Microsoft's CapEx Is Accelerating, Not Decelerating
  • Q3 FY26 CapEx came in at $31.9 billion, down slightly quarter-over-quarter due to normal timing variability, but management guided Q4 CapEx to increase to over $40 billion
  • FY2026 CapEx is now projected at approximately $190 billion, up from prior estimates near $155 billion, including a roughly $25 billion impact from higher component prices (this number partly drove the after-hours stock decline)
  • Roughly two-thirds of quarterly CapEx went to short-lived assets like GPUs and CPUs, with the remaining third going to long-lived data center assets supporting monetization over the next 15 years
• Azure Beat Guidance Again & Supply Is Still the Bottleneck
  • Azure grew 40% in Q3 FY26, above management's own guidance of 37–38%, signaling that demand continues to outpace what Microsoft can build
  • The CFO had explicitly noted that Azure's current growth bottleneck is capacity, not demand, meaning $NVDA supply constraints are directly capping Azure revenue, not customer appetite
  • Microsoft will continue to be capacity-constrained through 2026, even as it guides for Q4 Azure growth of 39–40%

$META:

• FY26 CapEx Guidance Raised Again, Up to $125–$145 Billion
  • CapEx guidance is up from the prior range of $115–$135 billion, the second consecutive upward revision for this year
  • Meta attributed the increase to expectations for higher component pricing this year, and to a lesser extent, additional data center costs to support future capacity
  • Zuckerberg pointed to memory pricing specifically as a driver of higher costs, and told investors that every sign he sees gives him confidence in the spending
• Revenue and Profit Are Growing Alongside Spending
  • Revenue grew 33% year-over-year to $56.3 billion, and net income jumped 61% to $26.8 billion
  • Meta is also rolling out more than 1 GW of its own custom silicon developed with Broadcom and AMD chips, to complement new NVIDIA systems in a notable “small” hedge against $NVDA’s sole-sourcing.

$AMZN:

• AWS Had Its Fastest Growth in 15 Quarters, and $NVDA Gave the Boost
  • AWS revenue reached $37.6 billion, up 28% year-over-year, and guided $200 billion in total CapEx for 2026
  • Amazon announced over one million NVIDIA GPUs to be deployed starting in 2026, giving AWS customers a wider range of accelerated compute options
  • Q1 CapEx hit $44.2 billion, primarily for AI infrastructure and data center build-out, and management echoed $MSFT, saying demand is running ahead of their ability to bring capacity online
• Amazon's Custom Chip Ambition is a Direct $NVDA Competitive Signal
  • Jassy stated on the call that at scale, Amazon expects Trainium to save tens of billions of dollars in CapEx annually and deliver several hundred basis points of operating margin advantage for inference versus relying on external chips (this is the clearest language any hyperscaler has used about replacing $NVDA)
  • The custom silicon business (Graviton, Trainium, Nitro) now has a $20 billion annual revenue run rate growing triple digits year-over-year, and Jassy claimed it is now one of the top three data center chip businesses in the world
  • Trainium2 is largely sold out, Trainium3 is nearly fully subscribed, and much of Trainium4 (still ~18 months from broad availability) has already been reserved with over $225 billion in total Trainium revenue commitments
• Amazon Is Still Buying $NVDA While Building an Alternate Path
  • Currently, both tracks are running in parallel, as the company still plans to deploy over 1 million $NVDA GPUs this year
  • Amazon secured Anthropic's commitment to use up to five gigawatts of Trainium capacity and OpenAI's commitment for approximately two gigawatts of Trainium capacity through AWS, beginning in 2027
  • In the short term, $AMZN needs $NVDA to fill capacity today. Long term, the tension between Trainium and $NVDA GPUs is worth watching closely.

$TSLA:

• Tesla is in a Major Capital Investment Phase due to AI
  • CapEx jumped 67% in Q1 to $2.49 billion, and management guided full-year 2026 CapEx to exceed $25 billion, up from the prior $20 billion forecast and a dramatic increase from $8.6 billion in 2025
  • Tesla explicitly stated it is further increasing investment in AI-related initiatives, including AI infrastructure to support Robotaxi and the launch of Optimus
  • Management anticipates negative free cash flow for the remainder of 2026 as the company funds production ramps for Cybercab, Semi, and Optimus. $NVDA orders are being filled regardless of near-term FCF
• The Hardware 3 Disclosure Creates a New $NVDA Tailwind
  • Musk confirmed on the Q1 call that Hardware 3 "simply does not have the capability to achieve unsupervised FSD," and scaled the end-of-2026 robotaxi rollout back
  • Tesla plans to set up a discounted trade-in program for cars with the older hardware, and will allow customers to upgrade their computers and cameras to enable future self-driving, possibly creating net new $TSLA and $NVDA revenue
  • Musk confirmed that the AI5 chip has taped out, but it will be used in Optimus and data centers rather than vehicles, allowing $NVDA-based systems to remain the vehicle compute standard for the foreseeable future

Overall, last week's earnings made it clear that the AI infrastructure buildout is continuing to accelerate. The major hyperscalers all collectively raised their 2026 CapEx forecasts, pushing the combined forecast toward $725 billion for the year. This figure validates Jensen’s recent upward revisions for Data Center revenue. Companies that are turning spending into growth are being rewarded, while those raising spending without clear near-term returns are being punished. $NVDA remains the essential "shovel seller," but this cycle introduced the idea that $NVDA cannot fulfill every slot in every data center, creating space for alternatives like $AMD and Broadcom. The commentary suggests that the memory side of $NVDA's ecosystem is equally supply-constrained and equally profitable. The full post (with a bonus ticker) is available for free on Substack, while Reddit posts are aimed toward discussion. What additional earnings are you watching this week? Thank you for reading. I am a person, and this is not financial advice.