Nvidia Stock Is Back at Its May Record. Its Quarterly Revenue Is 41% Higher.

Nvidia (NASDAQ:NVDA) stock is finally back at a record. Shares rose as high as $237.87 on Friday, Oct. 2, inching past the $236.54 peak they touched in trading on May 14. As I write, the stock is near $235, close to its May 14 record close of $235.74, and the artificial intelligence (AI) chip leader is worth about $5.7 trillion.

That means someone buying the stock now pays about what buyers paid in mid-May. But the business they're buying has grown a lot since then.

When the stock hit that May record, Nvidia's latest report was for the fiscal fourth quarter of 2026 (the three months ending Jan. 25, 2026), and revenue for the period was $68.1 billion. Its newest report, for the fiscal second quarter of 2027 (the period ending July 26, 2026), showed revenue of $96.2 billion. Put another way, Nvidia today pulls in 41% more revenue in one quarter, at around the same share price.

I think this gap matters more for the stock than the record itself.

Image source: The Motley Fool.

Sales kept climbing

The growth came in steps. Nvidia posted fiscal first-quarter revenue of $81.6 billion on May 20, just six days after the May record, and then $96.2 billion for fiscal Q2.

Not only did revenue rise every quarter, but growth also accelerated. Compared to the same quarter the year before, revenue was up 73% in fiscal Q4 and 85% in fiscal Q1. Then it more than doubled in fiscal Q2, rising 106%.

Most of that growth came from data center, the business that sells Nvidia's AI chips and networking gear to cloud providers and other data center operators. Showing how much of the company this business now makes up, data center revenue climbed from $62.3 billion in fiscal Q4 to $75.2 billion in fiscal Q1 and $89.0 billion in fiscal Q2 -- over 90% of Nvidia's total revenue in the last quarter. Plus, profits rose right along with sales. On a non-GAAP (adjusted) basis, Nvidia made $2.22 per share in fiscal Q2, up from $1.59 in fiscal Q4 (Nvidia now treats stock-based compensation as a cost in its adjusted earnings and restated earlier quarters to match). That's a gain of around 40% in just two quarters.

And management expects the climb to continue. Nvidia guided for fiscal third-quarter revenue of $108.0 billion, plus or minus 2%. At the midpoint, that's around 59% above the fiscal fourth-quarter revenue Nvidia had most recently reported when the stock last hit a record.

The stock is cheaper at the same price

In the four quarters Nvidia had reported by the May record (its fiscal 2026), it earned $4.64 per share on an adjusted basis. In its latest four reported quarters, that number is around $6.95 -- up about 50%.

Of course, the share price hardly changed in that stretch. So, the stock's price-to-earnings ratio on adjusted earnings has dropped from around 51 at the May record to about 34 today. By that measure, the stock is about a third cheaper than it was the last time it set a record.

I'm using adjusted earnings here because Nvidia's GAAP profits have lately been boosted by gains on its stakes in other companies -- around $15.9 billion of them before tax in fiscal Q1 alone.

These gains make the GAAP price-to-earnings ratio look lower than the underlying business would justify by itself. And they can swing the other way in a quarter when the stakes lose value.

Is growth slowing?

Measured quarter to quarter, though, Nvidia's growth is cooling. Revenue climbed 20% sequentially in both fiscal Q4 and fiscal Q1, then 18% in fiscal Q2. The $108 billion guidance implies around 12% for fiscal Q3.

And compared to the $57.0 billion Nvidia posted in the year-ago quarter, that guidance points to growth of around 89% year over year, down from fiscal Q2's 106%.

Yes, 89% growth for a business pulling in about $100 billion a quarter is exceptional. But Nvidia sells into an industry that has always run in cycles, and a stock at 34 times adjusted earnings could still drop hard if spending on AI data centers slows.

In the end, a record share price doesn't mean a pricier stock in Nvidia's case. The shares took more than four months to get back to where they were in May. In that time, quarterly revenue climbed 41%, and Nvidia's adjusted earnings for the past year rose around 50% per share.

That arguably makes the stock a better deal at this record than it was at the last one. I'd be more comfortable buying shares now than I would've been in May.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool has a disclosure policy.