NVDA Stock Extends Fall Overnight Despite Handy Q1 Beat — AI Darling Still Sees Untapped $200B Opportunity

• Nvidia reported blowout first-quarter results on Wednesday, powered by robust demand for its AI data center chips.
• Starting Q1, Nvidia will break down data center revenue into two subgroups: hyperscalers and ACIE (AI Clouds, Industrial, and Enterprise).
• CEO Jensen Huang said the company sees upside beyond its previously discussed $1 trillion revenue forecast for 2025 to 2027.

AI chip giant Nvidia reported another blowout quarter on Wednesday, signaling that demand for AI chips remains robust amid a massive global data center buildout. However, the beat was not big enough for Wall Street, sending the company's shares down more than 1% in after-hours and overnight trading. 

However, Nvidia showed it is expanding deeper into new customer and product categories and widening its total addressable market, countering, for now, the bearish view that its blistering growth pace would eventually slow.

The company expanded sales to smaller cloud firms and AI operators and began reporting revenue separately from customers outside the hyperscaler group, which includes Amazon, Microsoft, and Alphabet. Sales to those customers were roughly equal to those of the large cloud players, but grew faster quarter-over-quarter.

Nvidia also said that as AI workloads continue to transition from CPU to GPU-based accelerating computing, it is aggressively eyeing the market through its recently launched Vera CPUs and sees at least $20 billion in sales this year.

CEO Jensen Huang said the company sees upside beyond its previously discussed $1 trillion revenue visibility from three key areas: gaining a larger share of frontier AI model workloads, expanding sales of its standalone Vera CPUs and adoption of its specialized LPX systems. Huang previously forecast $1 trillion in sales from the company’s Blackwell ​and Rubin AI chips between 2025 and 2027.

NVDA Breaks Down Data Center Sales

Analysts and investors got greater clarity this quarter as Nvidia further broke down sales in its core data center segment – where revenue surged 92% to a better-than-expected $75.25 billion – into Hyperscale and ACIE (AI Clouds, Industrial, and Enterprise).

Revenue from server sales to hyperscalers grew 115% year over year and 12% sequentially to $37.87 billion, while revenue from the ACIE customers rose 74% year over year and 31% sequentially to $37.38 billion. 
 

NVDA’s CPU Opportunity

Separately, Nvidia is betting that its CPUs will become a major part of its business going forward. On the analyst call, Chief Financial Officer Colette Kress said, “Vera CPU opens a brand-new $200 billion TAM (total addressable market) for Nvidia, a market we have never addressed before.”

“Every major hyperscale and system maker is partnering with us to get it deployed… We have visibility to nearly $20 billion in total CPU revenue this year, setting us up to become the world-leading CPU supplier,” she said. 

The Vera CPU, unveiled at GTC 2026 as part of Nvidia’s Vera Rubin AI platform, is an Arm-based custom processor designed for AI and data center workloads. It positions Nvidia in more direct competition with server CPU leaders Intel and Advanced Micro Devices.

Intel and AMD shares dropped 0.7% in the overnight session ahead of Thursday. ARM shares were up nearly 3%, while NVDA shares were down 1.2%.

NVDA’s Q1 Recap, Retail View

In the last quarter, Nvidia’s revenue increased 85% to $81.62 billion, and adjusted earnings came in at $1.87 per share. Analysts had expected $78.86 billion in revenue and a $1.76. per share profit.

Nvidia also disclosed $30 billion worth of cloud computing ⁠agreements, up sequentially ​from $27 billion. The company increased its quarterly cash dividend to $0.25 per share from $0.01 per share and approved an $80 billion share buyback.

On Stocktwits, the retail sentiment for NVDA climbed multiple points higher in the ‘extremely bullish’ zone, amid ‘extremely high’ message volume. After remaining subdued for months, NVDA shares gained over the past month and are now up 19% year-to-date.

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