NVDA Q2 Guide of $91B Excludes China, Testing the AI Capex Bull Case

Nvidia's earnings report late Thursday fundamentally shifted the conversation around AI capex sustainability. The company posted $81.6B in Q1 revenue, a record, with $75.2B from data-center alone. The forward guide to $91B for the coming quarter was the headline that mattered most: it excluded any contribution from China operations, meaning management delivered a number that already assumes zero mainland revenue. This is critical context in a debate where bears have spent weeks arguing that hyperscaler spending would inevitably cool or that China restrictions would bite harder than expected.

The $91B guide amounts to roughly 13% sequential growth in an already-massive quarter. Jensen Huang held no giveaways in the call; he underscored that demand remains broad-based across all major cloud providers. Goldman, Morgan Stanley, and other sell-side houses had just spent weeks fielding questions on whether the AI trade had peaked. Nvidia's numbers are the most credible rebuttal available: MSFT, GOOGL, META, and AMZN all raised capex guidanceCompany-issued forecasts of future financial performance. in recent weeks, and Nvidia's results validate that those commitments are real and flowing through to orders.

Cross-asset implications are material. Semiconductor peers AMD and AVGO rallied hard on the data, and the Nasdaq breadth expanded, easing some concentration-risk anxiety for SPY holders. Memory-chip makers and infrastructure plays benefit from sustained capex cycles. The only concern is valuation: NVDA trades at roughly 33x forward earnings despite 80%+ revenue growth. Market is pricing in perfection, but at least now that perfection has a credible near-term roadmap.

Skeptics point to one risk: the $91B guide is still sequential growth, not explosive acceleration. If that rate of growth slows in the following quarter, it could spook investors who have come to expect perpetual acceleration. Additionally, China exposure remains a wild card; if US export restrictions tighten further, management may have to revise guidanceCompany-issued forecasts of future financial performance. downward.