AI chip giant NVIDIA on Thursday reported yet another strong result for the second quarter of its fiscal year 2026. For Q2 FY26, NVIDIA posted revenue of $46.7 billion, which is a 6% increase from the previous quarter and an 56% jump year-over-year.
However, the big tech’s stock fell 2.2% in US pre-market trading regardless of good results. This is because the company reported no sales of its H20 AI chips to customers in China due to ongoing US export restrictions.
This lack of access to a potential market disappointed investors, leading to a 3 to 4% drop in the stock during after-hours trading. Adding to the pressure, Nvidia’s data center revenue came in slightly below some analysts’ expectations.
While the company expressed optimism about potential future sales in China if geopolitical tensions ease, it did not factor any such revenue into its current quarter forecast.
The company’s data center segment led the charge, generating $41.1 billion in revenue. This is due to the widespread adoption of NVIDIA’s next-generation Blackwell AI platform and expanding cloud infrastructure deployments.
Gaming also delivered strong gains, with revenue hitting $4.3 billion, up 14% from Q1 and 49% annually, which indicates strong demand for RTX GPUs and new gaming technologies like DLSS 4.
“Blackwell is the AI platform the world has been waiting for, delivering an exceptional generational leap — production of Blackwell Ultra is ramping at full speed, and demand is extraordinary,” said Jensen Huang, founder and CEO of NVIDIA.
“NVIDIA NVLink rack-scale computing is revolutionary, arriving just in time as reasoning AI models drive orders-of-magnitude increases in training and inference performance. The AI race is on, and Blackwell is the platform at its center.”
NVIDIA Q2 FY26 results
NVIDIA reported gross margins of 72.4% (GAAP) and 72.7% (non-GAAP), driven by a shift in product mix toward higher-margin AI offerings.
Operating income surged to $28.4 billion, a 31% increase from Q1 and 53% higher year-over-year. Diluted earnings per share reached $1.08, up 42% from Q1 and 61% annually.
The company also continued to deliver significant shareholder returns, repurchasing $24.3 billion in shares and issuing dividends during the first half of FY26. The Board approved a $60 billion expansion to its share buyback authorisation.
NVIDIA leads the AI boom
Technologically, NVIDIA continues to lead the AI revolution. The Blackwell platform and NVLink rack-scale systems have seen broad global deployment, powering sovereign AI clouds in Europe and accelerating drug discovery efforts through partnerships with major pharmaceutical firms such as Novo Nordisk.
In gaming, the newly launched GeForce RTX 5060 has become the fastest-ramping x60-class GPU in company history, while DLSS 4 is now featured in over 175 games and applications. GeForce NOW, NVIDIA’s cloud gaming service, doubled its title library to more than 4,500 games.
Other segments also saw momentum. Professional visualisation revenue reached $601 million, supported by new RTX PRO GPUs and AI-driven design tools. The automotive and robotics division generated $586 million, with full production of the DRIVE AV platform and ongoing shipments of the DRIVE AGX Thor AI supercomputer.
NVIDIA projects Q3 FY26 revenue of $54 billion, plus or minus 2%, with gross margins expected at 73.3% (GAAP) and 73.5% (non-GAAP).