Nvidia Stock Slides 5% After Strong Q4 Earnings Beat

TLDR

• Nvidia stock fell as much as 5% in early trading on February 26 despite strong fourth quarter results.
• The company reported fiscal Q4 revenue of $68.1 billion, marking a 73% increase year over year.
• Data Center revenue reached $62.3 billion, driven by continued demand for advanced chips.
• Non-GAAP earnings per share rose to $1.62, reflecting an 82% annual increase.
• Gaming and Automotive revenue came in below analyst expectations during the quarter.

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Nvidia (NVDA) shares fell in early trading on February 26 despite strong quarterly results. The stock dropped as much as 5% after the company released its fiscal fourth quarter earnings. Traders shifted focus from headline growth to demand durability and capital spending trends.

Nvidia Stock Drops After Earnings Beat

Nvidia stock declined in early market activity even after the company beat revenue and profit estimates. The pullback followed a rally that had priced in strong data center demand. As a result, the earnings report failed to drive further upside momentum.

NVIDIA Corporation, NVDA

The company reported total revenue of $68.1 billion for fiscal Q4 2026, rising 73% year over year. Data Center revenue reached $62.3 billion, climbing 75% from the prior year. Non-GAAP earnings per share increased to $1.62, reflecting 82% annual growth.

However, Gaming revenue reached $3.73 billion and fell short of analyst expectations. Automotive revenue totaled $604 million and also missed consensus estimates. Consequently, investors questioned revenue concentration within the data center segment.

Management issued revenue guidance of $78.0 billion, plus or minus 2%, for fiscal Q1 2027. Wall Street had expected about $72.6 billion for the same period. Therefore, the outlook exceeded projections despite the stock decline.

CEO Jensen Huang said, “Demand for Blackwell remains strong across hyperscale customers.” He also confirmed that the company has started shipping samples of the Rubin platform. These updates reinforced continued product development and deployment.

Investors Focus on AI Spending Sustainability

Investors reacted with a sell-the-news move after recent gains in Nvidia stock. In recent weeks, Meta and Amazon signaled higher capital expenditure plans. Those updates had already supported expectations for strong chip demand.

As a result, the earnings beat did not materially alter the broader outlook. Traders shifted attention toward long-term returns on infrastructure investments. They questioned whether enterprise monetization would match hardware spending levels.

The data center division accounted for most of the company’s revenue growth. That concentration raised questions about balance across segments. Gaming and automotive performance failed to match the strength of data center sales.

Gross margin expanded to 75.2%, improving by 1.7% points year over year. The margin gain reflected pricing strength and product mix. However, supply constraints in memory components continued to affect certain segments.

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