Nvidia Reports 12% Revenue Growth Despite US Export Restrictions

Nvidia, a prominent chipmaker, reported a mixed performance for its first quarter of the 2026 fiscal year, which concluded on April 27. The company surpassed revenue expectations but fell short on earnings, primarily due to US export restrictions on its high-powered H20 artificial intelligence chips to China. Nvidia's revenue for the quarter was $44.1 billion, marking a 12% increase from the previous quarter and a 69% increase from the same period last year. This figure exceeded analyst estimates of $42.91 billion by nearly 2.7%. However, the company's earnings per share were 81 cents, missing analyst predictions of 85 cents per share. Nvidia's net income for the quarter was $18.8 billion, a 26% increase year-over-year.

During the earnings call, Nvidia's founder and CEO, Jensen Huang, emphasized the robust global demand for the company's AI infrastructure. He noted that AI inference token generation has surged tenfold in just one year and that as AI agents become more mainstream, the demand for AI computing will accelerate. Huang also underscored Nvidia's commitment to leading the development of agentic AI as the technology race intensifies.

The lower-than-expected income was attributed to a $4.5 billion charge resulting from US government restrictions on exporting its high-powered H20 artificial intelligence chips to China. In its outlook for the second quarter, Nvidia expects revenues around $45 billion, which reflects a loss in H20 revenue of approximately $8.0 billion due to recent export control limitations. To mitigate this impact, Nvidia plans to launch a new lower-cost AI chip specifically for China, with mass production expected to start in June.

Nvidia's data center revenue accounted for the majority of the firm's total revenues, reaching $39.1 billion, up 10% from the previous quarter. This segment continues to be a significant driver of the company's overall performance. Despite the challenges posed by export restrictions, Nvidia's strong revenue growth and continued investment in AI infrastructure position the company for future success in the rapidly evolving technology landscape.