Nvidia by the Numbers: 3 Remarkable Facts in Its Q2 Report

By now, most investors are aware of Nvidia's (NASDAQ:NVDA) results in its second-quarter earnings report.

The AI superstar topped its own ambitious guidance and Wall Street estimates, reporting 106% revenue growth to $96.2 billion, ahead of the consensus at $92.2 billion.

Gross margin expanded from 72.4% in the quarter a year ago to 75%, and adjusted earnings per share jumped 120% to $2.22, beating the average estimate at $2.09.

After declining post-earnings in its last four quarters, Nvidia seems on track for a win this time around, as the stock rose 4.4% in after-hours trading, though it was initially down after the report. The reversal seemed to come after CEO Jensen Huang said the company would grow revenue by at least 70%, when Wall Street was modeling around 45% growth.

Nvidia is the most valuable company in the world, and it's also the most profitable.

It's easy to glance at the numbers and not fully grasp the growth behind them, but Nvidia may have just had the best quarter in modern stock market history. Here are three stunning achievements in the quarter.'

Image source: Getty Images.

1. No other company this big has ever doubled its revenue

Nvidia just added nearly $50 billion in revenue in the quarter, a remarkable feat for any company, but there's no historical precedent for a company this big doubling revenue.

The closest analog is Tesla, which went from $31.5 billion in annual revenue in 2020 to $53.8 billion in 2021, a 71% increase, but that represents a slower revenue growth rate and a much smaller revenue base, given that Tesla's revenue figure there is yearly.

Nvidia's growth shows how quickly the AI chip market is expanding and that Nvidia continues to dominate it. Its data center revenue grew 117% to $89 billion, showing it still has a virtual monopoly in data center GPUs.

2. Nvidia just added an Apple's worth of profit

Apple is one of the most profitable companies in the world and has been for a long time. Just weeks ago, Apple briefly topped Nvidia as the most valuable company in the world.

In its most recent quarter, Apple reported $29.8 billion in net income, which is almost identical to the $29.2 billion in adjusted net income that Nvidia added in the second quarter.

Nvidia is so big and growing so fast that the amount of new profit it was able to add in the quarter was roughly equal to the total profit from the world's most profitable companies, like Apple, Alphabet, and Microsoft.

After forecasting 70% revenue growth next year, we could see Nvidia repeat the feat of matching Apple’s net income in profit growth.

3. Nvidia could hit $1 trillion in revenue in 2028

The race to $1 trillion in revenue is on. Elon Musk recently said that he expected SpaceX to reach that milestone by 2030, while Amazon looks set to do it in 2028.

However, after the strong second-quarter report and Nvidia's 70% revenue growth forecast for next year, it seems to be on a path to reach $1 trillion by fiscal 2029, which ends in Jan. 2029.

Analysts expect Nvidia to generate roughly $400 billion in revenue this year, and growing it 70% next year would bring that to $680 billion. To reach $1 trillion in revenue in 2028 (fiscal 2029), Nvidia would need to grow revenue by just 47%, which seems achievable given its current trajectory.

Can anything stop Nvidia?

The latest report and forecast from Nvidia put the bears back to sleep. While the stock's performance has only been average over the last year, the business continues to execute impeccably.

Concerns about competition have proven unfounded thus far, and demand for AI chips continues to outstrip supply.

The biggest risk facing Nvidia, which is also why the stock looks so cheap, is that the AI boom will fade faster than expected. However, the opposite seems to be happening. Wall Street analysts can't keep up with Nviida as they were again left flat-footed by Huang’s guidance for next year, badly underestimating the company's growth rate.

The future continues to look bright for Nvidia, and its low valuation should help push the stock higher over the coming months.

Jeremy Bowman has positions in Amazon and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Nvidia, and Tesla. The Motley Fool has a disclosure policy.