Nvidia's July quarter revenue more than doubled to $96.2 billion and adjusted profit landed at $2.22 a share, but the real story sits in a supply-chain bill that tripled in three months. Shares rose as much as 7.6 percent to $225.50 in Thursday trading, adding roughly $362 billion in market value, yet the stock has managed only a 12 percent gain this year through Wednesday, a far cry from the thousand-percent surge of the prior three years.
The margin math
Adjusted gross margin stands at 75 percent today. Viram Shah, chief executive of Vested Finance, expects it to compress to the low-70s by January as memory-chip costs climb. Training and inference workloads consume enormous amounts of high-bandwidth memory, and the three suppliers that dominate that market, Samsung Electronics, SK Hynix and Micron Technology, have signaled years of tight capacity before new factories come online. The resulting price surge flows straight into Nvidia's cost of goods sold.
The supply commitment surge
To secure allocation, Nvidia raised its purchase commitments from $119 billion to $279 billion in a single quarter, the bulk earmarked for memory. Chief Financial Officer Colette Kress told analysts on the post-earnings call that demand continues to accelerate even at current scale, adding that customer forecasts imply revenue could double again next year. The company also reiterated a target of 70 percent revenue growth for the 2028 fiscal year.
The pricing test
The question now is whether Nvidia can pass those higher input costs along. Raising prices on Hopper and Blackwell systems would protect margins but risks pushback from hyperscalers already scrutinizing data-center capital expenditure. Investors have grown harder to impress; concerns about circular valuation, Nvidia investing in startups that then buy its chips, and the sustainability of Big Tech spending have capped the stock despite sixteen consecutive quarters of sales beats.
What to watch
Guidance for the October quarter will show whether the commitment surge translates into recognizable revenue or merely inventory buffer. Margin trajectory through the January quarter will reveal if pricing power holds. And any signal from Samsung, SK Hynix or Micron on yield improvements or capacity additions will move the needle more than another earnings beat.