NVDA Q2 Guide of $91B Excludes China, While Hyperscalers Raise Capex

Nvidia's post-earnings guidanceCompany-issued forecasts of future financial performance. has become the market's north star for AI capex conviction. The company delivered $81.6 billion in record first-quarter revenue with $75.2 billion from data-center alone, commanding a 58.3 billion dollar net income haul. On the call, management guided 91 billion dollars for the next quarter and explicitly noted that this figure excludes any China data-center compute contribution. That caveat is the headline traders missed.

The implication is stark: Nvidia handed the street a number that assumes zero contribution from the second-largest internet market by population and hyperscaler base. Microsoft, Google, Amazon, and Meta all raised capex forecasts in recent weeks, and Nvidia's Q2 guide validates that those commitments are flowing into actual orders. Competing narratives around capex peaks or demand softness have been thoroughly discredited by this data point. Semiconductor peers like AMD and Broadcom (AVGO) rallied hard on the vindication; AMD rallied 8 percent on the day.

Geopolitical risk around Iran, the Strait of Hormuz, and broader Middle East tensions have not yet materially dented hyperscaler investment cycles. Oil spiked early in the week but has retreated on ceasefire optimism, removing an immediate inflationary shock to IT budgets. Energy costs remain a second-order concern relative to the urgency of closing the gap with competitors in AI model capability.

Skeptics point to valuation: Nvidia trades at 33 times forward earnings despite revenues up 80 percent year-over-year, and even a doubling of the stock would land it at fair value by some metrics. The risk is not demand destruction but rather multiple compression if rates rise sharply or if the Iran conflict escalates into a sustained oil-price shock that forces central banks to delay rate cuts.