Analysis of the Form 10-K | Fiscal year ended January 25, 2026
FY2026, ended January 25, 2026. All figures are in US dollars and come from the Form 10-K filed on February 25, 2026, unless a sentence attributes them to the 2026 Proxy Statement bound in the same Annual Review volume. The two market inputs (a closing price of $187.67 on January 25, 2026 and 24.3 billion shares outstanding as of February 20, 2026) were supplied for this report and are not taken from the filing.
What does NVIDIA sell, to whom, and how is it paid? It designs accelerated computing platforms (GPUs, CPUs, networking, systems and software) and has them built entirely by third parties: wafers come from TSMC and Samsung, memory from SK Hynix, Micron and Samsung, and assembly, test and packaging from contractors including Hon Hai, Wistron and Fabrinet. The company describes the offering as "typically delivered to customers as rack-scale systems, subsystems, or modules, along with software and services." Revenue is recognized when control of the product transfers, and the standard terms state that payment "is generally due shortly after delivery." Direct customers are AIBs, distributors, ODMs, OEMs, cloud providers, AI model makers and system integrators; indirect customers buy through them.
The company reports two segments. Compute & Networking holds Data Center and Automotive; Graphics holds GeForce and workstation GPUs. Revenue by segment:
| Segment | FY2026 | % of total | FY2025 | FY2024 | YoY FY2026 | YoY FY2025 |
|---|---|---|---|---|---|---|
| Compute & Networking | 193,479 | 89.6% | 116,193 | 47,405 | +66.5% | +145.1% |
| Graphics | 22,459 | 10.4% | 14,304 | 13,517 | +57.0% | +5.8% |
| Total | 215,938 | 100.0% | 130,497 | 60,922 | +65.5% | +114.2% |
The end-market split shows where the growth sits. Data Center is 89.7% of revenue. Inside it, networking grew 141.5% against 58.9% for compute, reversing FY2025, when compute had grown faster.
| End market | FY2026 | % | FY2025 | FY2024 | YoY FY2026 |
|---|---|---|---|---|---|
| Data Center: compute | 162,361 | 75.2% | 102,196 | 38,950 | +58.9% |
| Data Center: networking | 31,376 | 14.5% | 12,990 | 8,575 | +141.5% |
| Gaming | 16,042 | 7.4% | 11,350 | 10,447 | +41.3% |
| Professional Visualization | 3,191 | 1.5% | 1,878 | 1,553 | +69.9% |
| Automotive | 2,349 | 1.1% | 1,694 | 1,091 | +38.7% |
| OEM and Other | 619 | 0.3% | 389 | 306 | +59.1% |
| Total | 215,938 | 100.0% | 130,497 | 60,922 | +65.5% |
Revenue by geography is assigned by the location of the direct customer's headquarters. This basis was adopted in the third quarter of FY2026 and prior years were recast, so the geographic series is comparable within this filing but not with earlier filings.
| Customer headquarters | FY2026 | % | FY2025 | FY2024 | YoY FY2026 |
|---|---|---|---|---|---|
| United States | 149,617 | 69.3% | 77,482 | 31,533 | +93.1% |
| Taiwan | 42,345 | 19.6% | 23,600 | 14,912 | +79.4% |
| China (incl. Hong Kong) | 19,677 | 9.1% | 25,048 | 12,330 | −21.4% |
| Other | 4,299 | 2.0% | 4,367 | 2,147 | −1.6% |
| Total | 215,938 | 100.0% | 130,497 | 60,922 | +65.5% |
China fell 21.4% in a year in which the company states it was "effectively foreclosed from competing in China's data center computing/compute market." The filing does not split the remaining 19,677 million by end market, so it cannot be said how much of it is Gaming or other products. NVIDIA had about 42,000 employees at year end, 31,000 of them in research and development, with turnover of 3.7%. The filing discloses no change among its five executive officers, all of whom have held their current roles since 2018 or earlier according to their biographies.
Items without counterpart in the comparative columns include the Groq transaction, lease guarantees given to partners, 27 billion of cloud service purchases and a new tax reconciliation format; the separate balance sheet line for non-marketable equity is a reclassification applied to both years. NVIDIA is a supplier whose product has become a capital good for its customers, and FY2026 is the year in which the filing shows the company investing on a large scale in private companies that include some of those customers: purchases of non-marketable equity were 17,502 million, against 1,486 million in FY2025.
NVIDIA is classified here as a fast grower. Revenue rose 114.2% in FY2025 and 65.5% in FY2026, and research spending grew 43.2% in the latest year. It is not classified as cyclical, because the filing gives no price or volume series against which margins could be read across a cycle, and revenue rose in both years for which the filing allows growth to be computed. The cyclical question is nonetheless present in the document's own words: the company writes that "significant mismatches between supply and demand have varied across our market platforms, resulted in both product shortages and excess inventory, significantly harmed our financial results and could reoccur." The report therefore takes its decisive questions from both categories.
Three questions decide this case.
Several standard measures say little here: capex-to-depreciation, because capacity sits at suppliers and appears only as commitments; leverage and interest coverage, given net cash; and price to book. They are noted where they appear and not used as evidence.
Sections 3-bis, 3-quater with 3-sexies, and 5-bis are where the report goes deep, because those are where the three questions are answered.
What does the filing show about the advantage, as opposed to what the company says about it? Research and development reached 18,497 million, up 43.2%, after 48.9% growth the year before, so research was not cut while margins compressed. The company's statement that "we have invested over $76.7 billion in research and development since our inception" is a company figure; the three years in this filing account for 40,086 million of it. Lead times "in some cases, extended beyond twelve months," customers prepaid 9.0 billion during the year through advances, and the company expects supply constraints to weigh on Gaming in the first quarter of FY2027 and beyond. Those three facts are consistent with demand exceeding supply in FY2026.
The software claims (7.5 million developers, 6,000 supported applications) are the company's own, as is the description of CUDA as "one of the deepest moats we have created" in the shareholder letter dated May 2026, after the filing.
The filing also records the limits. Its competitor list names Alphabet, Amazon and Microsoft for their in-house accelerators, and cloud providers of their kind are among NVIDIA's largest customers. Whether the advantage is widening or narrowing cannot be established from the document.
The filing gives no selling prices or unit volumes, so pricing power cannot be documented. Gross margin fell from 74.99% to 71.07%, which the company attributes to the shift "from offering Hopper HGX systems to Blackwell full-scale datacenter solutions" and to H20. Without the H20 charge it would have been 73.15%. A lower margin is consistent with selling more of the system around the GPU, but the document does not separate mix from price.
Growth is essentially organic. Acquisitions net of cash were 1,535 million, and Groq brought "no customer contracts, existing products, or equity interests," with no pro forma presented because "the effect was not material."
Against revenue growth of 65.5%, cost of revenue grew 91.4%, research 43.2% and SG&A 31.2%. Operating expenses fell from 12.57% to 10.69% of revenue, while cost of goods outgrew sales, so operating income rose 60.1%.
Formulas: see Appendix, section 2.
NVIDIA's business in FY2026 shows operating leverage on fixed costs and the opposite on product cost. The margin that matters for the next filing is gross margin, because it carries both the system mix and the provisions examined in 3-bis.
How much of the year's profit came from operations, and how much from elsewhere?
| US$ million | FY2026 | FY2025 | FY2024 | YoY FY2026 | YoY FY2025 |
|---|---|---|---|---|---|
| Revenue | 215,938 | 130,497 | 60,922 | +65.5% | +114.2% |
| Cost of revenue | 62,475 | 32,639 | 16,621 | +91.4% | +96.4% |
| Gross profit | 153,463 | 97,858 | 44,301 | +56.8% | +120.9% |
| Gross margin | 71.07% | 74.99% | 72.72% | −3.92 pts | +2.27 pts |
| Research and development | 18,497 | 12,914 | 8,675 | +43.2% | +48.9% |
| SG&A | 4,579 | 3,491 | 2,654 | +31.2% | +31.5% |
| Operating income | 130,387 | 81,453 | 32,972 | +60.1% | +147.0% |
| Operating margin | 60.38% | 62.42% | 54.12% | −2.04 pts | +8.30 pts |
| Interest income | 2,300 | 1,786 | 866 | +28.8% | +106.2% |
| Interest expense | (259) | (247) | (257) | ||
| Other income, net | 9,022 | 1,034 | 237 | ||
| Income before tax | 141,450 | 84,026 | 33,818 | +68.3% | +148.5% |
| Income tax | 21,383 | 11,146 | 4,058 | +91.8% | +174.7% |
| Effective tax rate | 15.1% | 13.3% | 12.0% | ||
| Net income | 120,067 | 72,880 | 29,760 | +64.7% | +144.9% |
| Diluted EPS ($) | 4.90 | 2.94 | 1.19 | +66.7% | +147.1% |
| Diluted shares (mn) | 24,514 | 24,804 | 24,940 | −1.2% | −0.5% |
Pre-tax income grew faster than operating income because other income rose to 9,022 million. Of that, 8,918 million were gains on equity securities, mostly unrealized, including "gains from our previously announced investment in Intel's common stock." Without them, net income would be about 112.5 billion and growth 56.3%, against the reported 64.7%.
That figure is a construction of this report: it removes the gains the cash flow statement treats as non-cash and taxes the rest at each year's effective rate. It measures growth from operations and interest, and its limit is the tax step, since the actual tax on the gains is not disclosed.
Net income grew less than pre-tax income because the effective tax rate rose from 13.3% to 15.1%; the company explains that the tax benefits from stock-based compensation, FDDEI and the federal research credit grew less than pre-tax income.
| US$ million | Jan 25, 2026 | Jan 26, 2025 |
|---|---|---|
| Cash and cash equivalents | 10,605 | 8,589 |
| Marketable securities | 51,951 | 34,621 |
| Total cash and marketable securities | 62,556 | 43,210 |
| of which publicly-held equity (current) | 12,886 | 381 |
| Senior notes, short-term | 999 | — |
| Senior notes, long-term | 7,469 | 8,463 |
| Operating lease liabilities (PV) | 2,944 | not available |
| Gross debt including leases | 11,412 | not available |
| Net cash (cash and marketable securities − gross debt incl. leases) | 51,144 | not available |
| Net cash excluding leases | 54,088 | 34,747 |
| Shareholders' equity | 157,293 | 79,327 |
Net cash uses the reported total of cash and marketable securities, which includes 12,886 million of public equity, 10.5 billion of it under short-term lock-up. Excluding those holdings, available liquidity is 49,670 million and net cash 38,258 million; the report keeps the reported total and uses the stricter figure where liquidity is the subject (8-ter). FY2025 leases cannot be totalled because their short-term portion is not disclosed.
| US$ million | FY2026 | FY2025 | FY2024 |
|---|---|---|---|
| Cash from operations | 102,718 | 64,089 | 28,090 |
| Capex (property, equipment and intangibles) | (6,042) | (3,236) | (1,069) |
| Free cash flow | 96,676 | 60,853 | 27,021 |
| Stock-based compensation | 6,386 | 4,737 | 3,549 |
| Free cash flow after SBC | 90,290 | 56,116 | 23,472 |
| Share repurchases (cash) | (40,086) | (33,706) | (9,533) |
| Taxes paid on net share settlement | (7,948) | (6,930) | (2,783) |
| Dividends | (974) | (834) | (395) |
| Cash taxes paid | 20,288 | 15,118 | 6,549 |
| CFO / net income | 85.6% | 87.9% | 94.4% |
Owner earnings are a construction of this report: net income plus depreciation and other non-cash items, less equity gains and capex, shown with and without working capital. Stock-based compensation is not added back, since net income already treats it as a cost. The measure estimates what an owner could withdraw without shrinking the business; its limit is that it treats all capex and working capital as needed to keep the current scale.
| US$ million | FY2026 | FY2025 | FY2024 |
|---|---|---|---|
| Owner earnings before working capital | 106,239 | 65,499 | 27,194 |
| Working capital absorbed | (15,949) | (9,383) | (3,722) |
| Owner earnings after working capital | 90,290 | 56,116 | 23,472 |
The judgment uses owner earnings after working capital, which equal free cash flow minus SBC in every year. Before working capital they exceed free cash flow by 9,563 million, which is the 15,949 million of working capital absorbed less the 6,386 million of SBC that free cash flow adds back. Cash conversion fell in each year, from 94.4% to 85.6%, for reasons traced in 3-quater.
ROIC is a construction of this report. Invested capital is equity plus notes, less cash and marketable securities, private equity stakes and the 4,840 million of locked-up public equity in other assets; leases are left out because FY2025 totals are missing. NOPAT is operating income after the effective tax rate. The measure shows how much operating profit the business's own capital produces; its limit is that NVIDIA's capacity sits mostly at suppliers, so the denominator understates the capital the business depends on.
| Metric | FY2026 | FY2025 |
|---|---|---|
| NOPAT | 110,676 | 70,648 |
| Invested capital (year end) | 76,114 | 41,193 |
| ROIC on average capital | 188.7% | not calculable (FY2024 balance sheet not in document) |
| ROIC on year-end capital | 145.4% | 171.5% |
| EBITDA (operating income + D&A) | 133,230 | 83,317 |
| Gross debt incl. leases / EBITDA | 0.09x | not available |
| Net debt / EBITDA | net cash | net cash |
| Interest coverage (operating income / interest expense) | 503x | 330x |
| FCF / net income | 80.5% | 83.5% |
The report uses ROIC on average capital; on year-end capital it is 145.4%, lower because capital nearly doubled with 15.6 billion of new goodwill. Interest took 0.2% of operating income, and the long-term notes equal about 23 days of net income, figures recorded and set aside as 1-bis anticipated.
The multiples use the supplied close of $187.67 on January 25, 2026, the last day of the fiscal year, so that price and earnings share a date; the price is not updated, and market capitalization uses the supplied 24.3 billion shares.
| Multiple at $187.67 (Jan 25, 2026) | Value |
|---|---|
| Market capitalization | $4,560.4 billion |
| Enterprise value (market cap + notes + leases − cash and marketable securities) | $4,509.2 billion |
| P/E (diluted EPS 4.90) | 38.3x |
| P/E excluding equity gains (EPS 4.59) | 40.9x |
| Price / sales | 21.1x |
| Price / free cash flow | 47.2x |
| Free cash flow yield | 2.12% |
| FCF after SBC yield | 1.98% |
| EV / EBITDA | 33.8x |
| EV / EBIT | 34.6x |
Formulas: see Appendix, section 3.
At this price a buyer pays 47 years of FY2026 free cash flow, or 41 years of earnings excluding equity gains. Those figures restate the price in units of the company; whether the denominators are durable is the subject of 3-bis to 3-sexies.
Which numbers in this balance sheet are management's opinion, and how much would a change of opinion move them? The auditor names one Critical Audit Matter: the valuation of inventories, specifically provisions for excess or obsolete inventory and for excess product purchase commitments. Management lists four critical estimates: inventories, income taxes, non-marketable equity securities and revenue recognition. Those, plus the notes that weigh most on assets or profit, are treated below.
This is the note on which the first decisive question rests. Inventories are 21,403 million, 10.3% of total assets. The auditor puts them beside 95.2 billion of "outstanding inventory purchase and long-term supply and capacity obligations." Commitments are 1.52 times the year's cost of revenue and 4.4 times the inventory on hand, and the company says that "substantially all will be paid through fiscal year 2027." Provisions charged to cost of revenue were 7.2 billion in FY2026, including the 4.5 billion H20 charge. Of the total, 4.0 billion went against inventory and about 3.2 billion against excess purchase obligations. Releases from selling previously reserved inventory and settling obligations were 1.5 billion. The net effect on gross margin was unfavorable by 2.6%, after 2.3% in FY2025. Provisions are therefore a recurring cost of this business, not an event of one year.
The discretion is wide: provisions rest on "assumptions about future demand and market conditions, which requires management judgment." Write-downs are "not subsequently written-up," so an unnecessary provision returns to profit only when the reserved product is sold, as with this year's 1.5 billion of releases.
Three things would move the figure: a regulatory change that strands a product, as H20 did within one quarter; a product transition customers wait for, on a cadence now of one architecture a year; and any demand shortfall against commitments placed "in advance of our historical lead times." The filing gives no sensitivity and no prior-year commitment total, so the growth of the exposure cannot be measured.
Non-marketable equity securities are 22,251 million (10.8% of total assets), up from 3,387 million; publicly-held equity is a further 17,726 million. Together they are 19.3% of total assets. Net additions to private holdings were 17,444 million in the year, and the company describes them as "primarily to support early‑stage startups. These investments include AI model makers that purchase our products directly or through CSPs."
Private holdings are carried at "cost minus impairment," adjusted for "observable price changes in orderly transactions," with "unobservable inputs" in the valuation. They produced 2,369 million of unrealized gains and 101 million of impairments this year; public holdings produced 6.6 billion of net unrealized gains, after amounts the company calls "not significant" in the two prior years.
An investee's next financing round revalues the holding through earnings in either direction, and a 10% fall in public holdings would cost 1.8 billion, with lock-ups restricting sales. The filing does not state how much revenue came from investees, so the flow that leaves as investment and returns as revenue cannot be measured (5-bis).
Goodwill rose from 5,188 million to 20,832 million (10.1% of total assets), and 14.4 billion of the increase comes from Groq. NVIDIA entered "a non‑exclusive license agreement with Groq, Inc., or Groq, for its language processing unit technology and hired certain Groq employees." It recorded a developed technology intangible of 2.5 billion, valued "using a cost‑to‑recreate methodology with a five‑year useful life." Consideration was 13.0 billion paid at closing plus 4 billion payable within a year, so goodwill equals 85% of the 16.9 billion recorded. The goodwill is "primarily attributable to the workforce and future development of the licensed technology" and is tax deductible.
The discretion has two layers. A non-exclusive license plus hires, with no customers, products or equity, produced goodwill rather than an expense or an amortizing asset, and the filing does not explain how the transaction passed its business-combination screen. The impairment test was qualitative and discloses no headroom.
The figure would move if the licensed technology is not incorporated into products. The risk factors state that this "may not occur on expected timelines or at all" and that the company "may be unable to recover the associated costs." Amortization of intangibles will rise from 488 million to an expected 923 million in FY2027, largely because of the Groq intangible.
The effective rate was 15.1%. The gap to the 21.0% statutory rate comes mainly from the FDDEI deduction (−3.0 points) and the reduced Israeli rate (−2.2 points). Tax credits and stock compensation account for most of the rest. Cash taxes were 20,288 million against an expense of 21,383 million, so taxes are paid close to the rate at which they are booked. The release of 711 million of state valuation allowance, "based on recent jurisdictional taxable income and expected future earnings," is 0.6% of net income and does not change the reading of the year. Unrecognized tax benefits rose from 2,861 million to 4,420 million, of which 3.7 billion would lower the rate if recognized, and the IRS is examining FY2023 and FY2024. The rate would move if FDDEI were reduced, which the company names as a risk, or if a lower share price shrank the stock-compensation benefit, worth 1,475 million this year.
Customer program accruals, recorded as a reduction of revenue and estimated from "historical attainment and claim rates," rose 9.0% to 5,318 million while revenue rose 65.5%. Deferred revenue rose from 1,813 million to 2,572 million. Customers paid 9.0 billion in advances during the year and took delivery of almost all of it within the year, so only 160 million remained at year end. Remaining performance obligations on contracts longer than a year are 2.3 billion. Future revenue is therefore not visible in the balance sheet: the filing gives no backlog and does not say whether any revenue is recorded net.
Warranty additions were 2,474 million, 1.15% of revenue, after 0.92% and 0.46% in the two earlier years. They relate mainly to Compute & Networking, and the liability more than doubled to 2,807 million. The filing does not explain the rising rate. It coincides with the move to rack-scale systems, and the risk factors list "increased warranty costs" among the effects of product transitions.
Beyond supply commitments, the company had 27 billion of multi-year cloud service agreements "to support our research and development efforts," 1.46 times the year's R&D. It also had 11.4 billion of investment commitments "subject to certain contingencies" and 22.7 billion of data center leases to commence by FY2030. None is a liability today. It also guaranteed "partners' facility lease obligations in the event of their default in exchange for warrants," up to 3.5 billion over five to seven years, against 712 million of partner escrow. MD&A identifies the partners as "early‑stage companies" and says that on default NVIDIA "may elect to assume the underlying leases." The guarantees are carried at a fair value the company calls "not material."
The 2018 securities class action over channel inventory and cryptocurrency demand returned to the district court in February 2025, and four derivative suits are stayed; nothing is accrued, and the company says any loss "cannot be reasonably estimated at this time." China's antitrust regulators published a preliminary finding in September 2025 that NVIDIA's compliance with US export controls breached the terms of China's approval of the Mellanox acquisition; no exposure is quantified. The 8,468 million of notes are fixed-rate, unsecured, non-convertible and carry non-financial covenants, and the commercial paper program was raised to 25.0 billion with nothing drawn. Unearned stock compensation of 14.8 billion, to be recognized over about 2.3 years, is contracted dilution equal to 12.3% of FY2026 net income. There are no defined benefit pension plans. The proxy statement discloses family employment and a Huang Foundation arrangement with CoreWeave for donated compute, to whose grant recipients NVIDIA plans free engineering services. After year end the company received an H200 license for China with no revenue so far, repurchased 1.5 billion of shares, and was "finalizing an investment and partnership agreement with OpenAI" with "no assurance" of completion.
Formulas: see Appendix, section 3-bis.
Taxes, debt and litigation are conventional and small against profit. Inventory, commitments, investments and Groq goodwill carry most of the judgment in this filing, and all four rest on the same assumption, that current demand continues.
What sits inside the large lines? Eight asset lines and one liability line carry most of the balance sheet.
Marketable securities (51,951 million, 25.1% of assets) are mostly Level 2 Treasuries, corporate bonds and agencies, plus 12,886 million of public equity largely under lock-up; with cash (10,605 million) they form the liquid assets, nearly all usable in the US without further federal tax.
Receivables (38,466 million, 18.6%) grew in line with revenue, and 56% is owed by three customers. The allowance for doubtful accounts was 4 million at each of the three year ends, while gross receivables rose from 23,069 million to 38,470 million. The company says its credit exposure "excludes amounts covered by credit insurance and letters of credit," but it does not quantify that cover, so the adequacy of the allowance cannot be judged.
Inventories (3-bis) grew 112.3%. The build is in work in process (+159.5%) and finished goods (+168.1%), not in raw materials (+11.7%). Goodwill, intangibles and non-marketable equity are covered in 3-bis; the filing discloses no capitalized software or development cost. Deferred tax assets (13,258 million, 6.4%) consist mainly of capitalized research, CFC tested income and accrued reserves; their recovery rests on future taxable income, which the company judged sufficient when it released part of the valuation allowance (3-bis). Property and equipment (10,383 million, 5.0%) is mostly compute hardware; accumulated depreciation fell from 41.2% to 38.8% of cost as new assets arrived. Of other assets (8,301 million), 4,840 million is locked-up public equity and 3,461 million is not broken down. Supplier prepayments, mentioned in the risk factors, are not shown separately.
Accrued and other current liabilities (21,352 million, 10.3%) consist mostly of customer programs, the 3,921 million still owed for Groq, warranty and excess purchase obligations. Debt, leases included, is itemized in section 3.
| Working capital days (year-end balances, 364-day year) | FY2026 | FY2025 |
|---|---|---|
| Days sales outstanding | 64.8 | 64.3 |
| Days inventory | 124.7 | 112.4 |
| Days payables | 57.2 | 70.4 |
| Cash conversion cycle | 132.4 | 106.4 |
The cycle lengthened by 26 days, through 12 more days of inventory and 13 fewer days of payables. The risk factors note that "our vendors have requested and may continue to ask for shorter payment terms." Only two balance sheets are available, so this is one comparison, not a trend.
Equity has no minority interest and no treasury stock, because repurchased shares are retired, almost entirely against retained earnings (146,973 million, 71.1% of assets). Return on average equity was 101.5%. Buybacks shrink equity and inflate that figure: adding back the 84,149 million repurchased in the three years presented, a construction limited to those years, gives 65.9%. Retained earnings more than doubled, which is what a company distributing 34.4% of net income through dividends and repurchases would show (41.1% including share-settlement taxes, 3-quinquies), and they should be read beside that ratio.
About 32.6% of total assets is valued on observable prices (cash and Level 1 and 2 securities). About 28.8% rests on management estimates: private equity, goodwill, intangibles and deferred tax assets. The remaining 38.6% is receivables, inventory and fixed assets at cost-based measures, of which inventory carries the audit's main judgment.
Formulas: see Appendix, section 3-ter.
The balance sheet is liquid and unlevered, and the part that rests on estimates has grown quickly, from 18.2% to 28.8% of total assets. The larger risk does not appear on it: commitments not yet recognized are larger than total assets net of cash and marketable securities.
How much of the 102,718 million of operating cash came from the business, and how much from timing? The decomposition:
| US$ million | FY2026 | FY2025 | FY2024 |
|---|---|---|---|
| Net income | 120,067 | 72,880 | 29,760 |
| Stock-based compensation | 6,386 | 4,737 | 3,549 |
| Depreciation and amortization | 2,843 | 1,864 | 1,508 |
| Gains on equity securities | (8,918) | (1,030) | (238) |
| Deferred taxes | (1,424) | (4,477) | (2,489) |
| Other | (287) | (502) | (278) |
| Accounts receivable | (15,399) | (13,063) | (6,172) |
| Inventories | (11,324) | (4,781) | (98) |
| Prepaid and other assets | 577 | (395) | (1,522) |
| Accounts payable | 3,096 | 3,357 | 1,531 |
| Accrued and other current liabilities | 5,257 | 4,278 | 2,025 |
| Other long-term liabilities | 1,844 | 1,221 | 514 |
| Cash from operations | 102,718 | 64,089 | 28,090 |
Receivables and inventory together absorbed 26.7 billion. Liabilities supplied 10.2 billion. Equity gains of 8.9 billion are in net income but not in cash. Together they account for the fall in conversion from 87.9% to 85.6%.
Money held temporarily for others is modest. Payables, accrued and other long-term liabilities rose 10,197 million, 10.5% of free cash flow, and the increase is mostly accrued taxes, warranty and purchase-obligation reserves, not cash collected ahead of service. Payables grew 55.5% against cost of revenue at 91.4%, so suppliers were paid faster, and customer advances were almost entirely delivered within the year (3-bis).
Cash taxes of 20,288 million were 1,095 million below the income statement charge; the gap sits in tax payables, including growing uncertain positions.
Capex does not cover the investment the business requires. Against 6,042 million of capex stand the supply commitments, cloud agreements and leases not yet commenced described in 3-bis, and a 13.0 billion payment for a license booked mostly as goodwill. Free cash flow therefore excludes most of what NVIDIA spends to secure future capacity, because that spending is either not yet cash or classified elsewhere.
Free cash flow grew by 35,823 million. Working capital absorbed 6,566 million more than in FY2025, so it reduced the growth of free cash flow rather than inflating it.
Formulas: see Appendix, section 3-quater.
The cash is real and only slightly flattered by other people's money; its weakness is what it leaves out.
Did per-share value grow as fast as the company? The diluted share count fell 1.7% over the two years, so per-share figures grew slightly faster than totals:
| Per diluted share ($) | FY2026 | FY2025 | FY2024 | Change FY24→FY26 |
|---|---|---|---|---|
| Revenue | 8.81 | 5.26 | 2.44 | ×3.61 |
| Net income | 4.90 | 2.94 | 1.19 | ×4.10 |
| Free cash flow | 3.94 | 2.45 | 1.08 | ×3.64 |
| Shareholders' equity | 6.42 | 3.20 | 1.72 | ×3.72 |
The shareholder did not fall behind the business.
On the definitions of section 3, NOPAT rose 40,028 million on 34,921 million of added capital, an incremental return of 114.6%. With two balance sheets this is a single point. It is below the average return because the added capital includes 14.4 billion of Groq goodwill with no identified revenue yet.
Reinvestment (capex less depreciation, acquisitions including Groq, and working capital) was 30.4% of NOPAT. At the 188.7% ROIC this implies operating profit growth of 57.4%, close to the actual 60.1%, so growth is explained by reinvestment at current returns without leverage or one-off items. Counting the 17.4 billion net put into private companies raises the rate to 46.2%, but their return does not appear in ROIC.
Together these figures describe a business that earns very high returns but can absorb only about a third of its profit at them. Beyond that reinvestment, in FY2026 it distributed 41.1% of net income through buybacks, share-settlement taxes and dividends, and put the rest into securities and private stakes. The ROIC is therefore collected, not compounded: what most of each year's profit earns next depends on the price of the shares and stakes it buys.
Self-financing is complete. Over three years free cash flow was 184,550 million, equity transactions absorbed 99,449 million net, debt repayments 2,500 million, and no debt was issued.
Capex was 4.6% of cumulative net income and rose from 0.71 to 2.13 times depreciation, which describes the company's own compute and buildings, not production capacity. With depreciation as a stand-in for maintenance capex, which the filing does not separate, operating cash after maintenance would be 99,875 million. The approximation is weak here, because spending on future revenue sits in R&D, cloud commitments and supplier prepayments, not in capex.
A buyer of the whole company at $187.67 would earn 2.89% pre-tax on FY2026 operating income. The P/E-to-growth ratio is omitted, because two years of accelerating growth are too short a base. Over the same three years as the research total in section 2, annual revenue rose by 155,016 million; the filing discloses no capitalized development cost.
Formulas: see Appendix, section 3-quinquies.
The returns on the operating business are not in question. What decides the outcome for an owner is where the larger part of each year's cash goes, and section 5-bis follows it.
Which balance sheet lines are moving ahead of the income statement?
| Comparison (FY2026 vs FY2025) | Growth A | Growth B | Gap (pts) |
|---|---|---|---|
| Inventory vs revenue | +112.3% | +65.5% | +46.8 |
| Receivables vs revenue | +66.8% | +65.5% | +1.3 |
| Allowance for doubtful accounts vs gross receivables | 0.0% | +66.8% | −66.8 |
| Payables vs cost of revenue | +55.5% | +91.4% | −35.9 |
| Warranty additions vs revenue | +105.7% | +65.5% | +40.2 |
| Capitalized development cost vs related expense | not disclosed | — | not calculable |
| Cash from operations vs revenue | +60.3% | +65.5% | −5.2 |
Four gaps matter. Inventory outran revenue by 46.8 points, in work in process and finished goods; the company explains the purpose of its supply purchases but not the year-end level, which is exactly the judgment the CAM covers. The allowance for doubtful accounts did not grow with receivables, but it has not moved in three years, so it is a constant amount rather than a release, set against an insured share that 3-ter shows is unquantified. Payables moved opposite to the usual warning, and warranty additions grew faster than revenue, which is the conservative direction. The receivables gap is small.
Cash from operations grew 5.2 points less than revenue in FY2026, after outgrowing it in FY2025 (+128.2% against +114.2%), so the divergence appears in one year only. It is carried to section 9 because it comes from the same lines as the inventory gap.
Formulas: see Appendix, section 3-sexies.
The early signals point at a single place, inventory and the commitments behind it.
NVIDIA is a semiconductor and hardware company without its own manufacturing, which is how the filing describes it ("a fabless and contracting manufacturing strategy"). For this group, capacity sits outside the balance sheet, and commitments to third parties are the economic equivalent of plants.
Supply and capacity commitments of 95.2 billion equal 1.52 times FY2026 cost of revenue and 4.4 times year-end inventory, and substantially all of them fall due within FY2027. Days of inventory were 124.7, up from 112.4, against a product cadence the company describes as "new advanced architectures on a one-year product cadence." A year-end inventory equal to about a third of a year's cost of goods therefore sits against a cadence of one new architecture per year. Supplier prepayments and deposits are mentioned in the risk factors but not separated in the balance sheet, so they cannot be measured.
Research was 8.6% of revenue, against 9.9% and 14.2%, because revenue outgrew a budget that rose 43.2%. Wafers come from TSMC and Samsung, memory from three suppliers, and the company depends on supply "especially in Taiwan and South Korea"; its long-lived assets in Taiwan rose from 1,481 million to 3,219 million. Two direct customers account for 22% and 14% of revenue. Three account for 25%, 18% and 13% of receivables. Some supply lead times exceed twelve months, while "most of our sales are made on a purchase order basis" and customers "can generally cancel, change, or delay product purchase commitments with little notice to us and without penalty."
This asymmetry is the sector reading of the year. Supply agreements can be cancelled, rescheduled or adjusted only "in certain instances" and before firm orders are placed, and changes "may result in additional costs"; the filing does not say what share of the commitments is firm. Customer orders can generally be cancelled without penalty. The 4.5 billion H20 charge shows what happens to the difference when demand disappears, in that case for regulatory reasons.
Standard measures that do not apply are capex as a measure of capacity, debt-to-EBITDA and interest coverage given net cash, and book value as protection. Recurring software revenue and renewal rates are not disclosed.
The sector metrics confirm 1-bis. NVIDIA's largest commitments are its supply contracts, and their size against a year of cost of goods is the figure that measures the company's exposure to its own forecast.
Which risks does the filing itself document, and which have already cost money? In order of severity:
The first four share the root identified at the close of 3-bis.
The filing does not mark which risk factors are new, and the previous year's 10-K is not attached, so a comparison is not possible. Several risks describe events the filing itself dates within FY2026: the H20 license requirement (April 2025), the H20 licenses granted (August 2025), China's preliminary antitrust finding (September 2025), the Groq license (December 2025), the facility lease guarantees (entered in FY2026) and the H200 license (February 2026). That dating places them in the year, but does not establish that the corresponding risk factor was absent before.
Who controls NVIDIA? No shareholder controls it. According to the proxy statement, the co-founder and CEO, Jen-Hsun Huang, beneficially owns 870.6 million shares, 3.58% of the total as of March 23, 2026. All directors and executive officers together own 3.94%. BlackRock (7.43%) and Vanguard (7.31%) are the only holders above 5%, based on their own filings. The proxy does not say how the CEO's shares were acquired.
Two provisions affect a change of control. Delaware law and the charter limit shareholder action, and under the Xbox agreement Microsoft "may have first and last rights of refusal" if someone offers to buy at least 30% of the stock. The insider trading policy prohibits hedging and pledging of NVIDIA shares, according to the proxy statement. In the fourth quarter the CFO adopted a trading plan to sell up to 500,000 shares through March 2027.
PricewaterhouseCoopers has audited the company since 2004 and issued unqualified opinions on the statements and on internal control. Fees were 13.4 million in FY2026, of which 10.2 million for the audit (proxy statement). Related-party disclosures are limited to family employment and the Huang Foundation's arrangement with CoreWeave, both described in 3-bis.
The structure is conventional; the filing contains no governance signal that changes the reading.
What did management do with the cash, and what did each choice produce per share?
Capital allocation. Over the three years, operating cash totalled 194,897 million.
| Uses of cash, US$ million | FY2026 | FY2024–FY2026 | Share of 3-year CFO |
|---|---|---|---|
| Share repurchases (cash) | 40,086 | 83,325 | 42.8% |
| Taxes on net share settlement | 7,948 | 17,661 | 9.1% |
| Net purchases of marketable securities | 14,233 | 37,547 | 19.3% |
| Private equity investments, net | 17,418 | 19,594 | 10.1% |
| Groq | 13,000 | 13,000 | 6.7% |
| Capex | 6,042 | 10,347 | 5.3% |
| Acquisitions, net of cash | 1,535 | 2,625 | 1.3% |
| Debt repaid | — | 2,500 | 1.3% |
| Dividends | 974 | 2,203 | 1.1% |
The mix changed in FY2026. Payments to retire shares were 46.8% of operating cash, against 51.8% over three years. Groq, acquisitions and private stakes rose to 31.1%, against 3.6% in FY2025 and 3.4% in FY2024. Of the acquisitions in comparative years, the filing records no impairment, and the goodwill of earlier deals in Graphics has stayed at 370 million.
Share repurchases. NVIDIA repurchased 282 million shares at a cost of 40,388 million, an average of $143.22 per share; on a cash basis the average is $142.15. The report uses the cost recorded in equity, which includes the excise tax. The year's average is 23.7% below the closing price of $187.67. In the fourth quarter, purchases averaged $198.89, $179.41 and $186.52 in the three periods; weighted by the volumes the filing reports, rounded to 0.1 million shares, that comes to about $187.67, in line with the closing price.
The ratio of average price paid to free cash flow per share is a construction of this report, limited by its use of one year's cash flow. It shows the multiple at which the company bought itself: 36.3 times in FY2026, a 2.75% yield. The multiple was 44.7 in FY2025 and 42.6 in FY2024. Spending rose in both years whichever way the multiple moved. Free cash flow covered repurchases 2.4 times.
Net dilution. Employee plans delivered 160 million shares, of which 51 million were withheld for employees' taxes at $155.84 each, for net issuance of 109 million. Repurchases retired 282 million, so the count fell 173 million, or 0.71%, and 38.7% of the shares bought only offset issuance. Over three years, 101,810 million spent on repurchases and withholding reduced the count by 1.45%. The repurchases did more than plug dilution, but a large part of the spending absorbed share-based pay.
Accounting aggressiveness. The non-GAAP operating income used for pay excludes stock compensation, acquisition-related costs and "other." Across FY2025 and FY2026 the exclusions total 12,249 million, 10.2% of FY2026 net income. Of that, 11,123 million is stock compensation, which recurs every year.
Governance signals in the document. No material weakness, restatement or change of auditor; a phased ERP upgrade is in progress.
Compensation and incentives. Per the proxy statement, executive pay rests on revenue (cash bonus), non-GAAP operating income (one-year PSUs) and three-year TSR relative to the S&P 500. In March 2025 the committee set stretch goals of 190.0 billion of revenue and 120.0 billion of non-GAAP operating income, which "would automatically be reduced to $160.0 billion and $96.0 billion" if new export controls hit H20; they did. Results of 215.9 billion and 137.3 billion beat even the original goals, all plans paid the maximum, and the CEO's reported compensation was 36.3 million. The metrics reward revenue and an operating income that leaves out stock compensation; none measures cash conversion, inventory or the return on committed capital.
The decisions of the year, read together. Separate notes record a set of choices within FY2026. The company paid 13.0 billion, and owes 4 billion more, for a non-exclusive license and a group of hires (Note 2). It invested 17.5 billion in private companies that include AI model makers buying its products, committed 11.4 billion more, and is finalizing an agreement with OpenAI (MD&A, Note 12). It guaranteed 3.5 billion of partners' data center leases in exchange for warrants (Note 10). It contracted 27 billion of cloud capacity, with 22.7 billion of data center leases still to commence (Notes 12, 17). And it raised its commercial paper program to 25.0 billion, undrawn (Note 11).
Read together, these choices show NVIDIA moving from seller of systems to a party that also funds, guarantees and buys from parts of the ecosystem that buys from it. The filing identifies neither the cloud counterparties nor the revenue from investees, so the circular flow cannot be sized. Its consequence for next year's balance sheet can be stated: more assets valued on estimates, larger obligations off the balance sheet, and borrowing capacity on a scale the company did not previously have.
Formulas: see Appendix, section 5-bis.
Management generated cash at a scale that leaves no funding question, and returned most of it. The open question in this section is the 31% of FY2026 operating cash that went into stakes, a license and acquisitions whose return the filing does not report, alongside guarantees and commitments that have not yet required cash.
Does management admit a mistake, a missed target or a write-down in this document? Yes, on four counts, all in the 10-K and not in the shareholder letter.
The company quantifies the H20 charge and its cause: "we incurred a $4.5 billion charge in the first quarter of fiscal year 2026 associated with H20 for excess inventory and purchase obligations, as the demand for H20 diminished." It writes about China that "our effective foreclosure from the China market helped our competitors build larger developer and customer ecosystems to challenge us worldwide." It records a past operational problem: "our gross margins in the second quarter of fiscal year 2025 were negatively impacted by inventory provisions for low-yielding Blackwell material." And it states without qualification that supply-demand mismatches "significantly harmed our financial results and could reoccur."
These admissions concern external shocks and a prior year's execution. The year's own capital decisions (Groq, the private investments, the guarantees) carry risk language but no stated expected return against which they could later be judged.
Which accounting choices move reported profit?
Comparability is affected by the separate line for non-marketable equity (no effect on totals), the recast geographic basis, a tax disclosure standard adopted prospectively, and a 53-week FY2027. An expense disaggregation standard arrives in the FY2028 report.
The single Critical Audit Matter is inventory and purchase commitment provisions, examined in 3-bis.
Four choices move profit. Equity gains pass through the income statement (6.3% of pre-tax income, including 2,369 million from revaluing private holdings). Inventory and commitment provisions are estimates whose net cost is set out in 3-bis. Groq was booked mainly as goodwill, which is not amortized; spread over the five years used for its technology asset, the 14.4 billion would cost about 2.9 billion a year, arithmetic only and not a view of the correct treatment. Warranty and customer program accruals rest on historical rates that a new product type may not follow.
GAAP and non-GAAP measures differ by stock-based compensation, acquisition-related costs and other items, which together came to 6,913 million in FY2026. The effective tax rate differs from the 21.0% statutory rate for the reasons set out in 3-bis.
Formulas: see Appendix, section 6.
Reported operating profit is clean of large one-off items other than the H20 charge, which the company discloses. The quality issues sit lower and higher in the income statement: in the equity gains below operating income, and in the provisions inside cost of revenue that depend on demand assumptions.
Which developments, stated in the filing, could lift results above FY2026?
The filing quantifies none of these as revenue.
What did the company say a year ago, and what happened? The previous 10-K is not attached, and this filing does not restate prior-year guidance. The only prior expectations it contains are the compensation goals set in March 2025, reported in the proxy statement:
| Item (set March 2025) | Stated | Achieved FY2026 | Difference |
|---|---|---|---|
| Revenue, base plan | 130.0 bn | 215.9 bn | +66.1% |
| Revenue, original stretch | 190.0 bn | 215.9 bn | +13.6% |
| Non-GAAP operating income, base plan | 71.0 bn | 137.3 bn | +93.4% |
| Non-GAAP operating income, original stretch | 120.0 bn | 137.3 bn | +14.4% |
Results exceeded the original stretch goals by 13.6% and 14.4%, even after an export restriction that the plan had anticipated and priced at 30 billion of revenue. The comparison measures how far the year exceeded internal plans; it says nothing about the plans for FY2027, which the filing does not disclose. A comparison of capex, buyback or margin intentions with outcomes is not possible from this document.
Suppose that three years from now an investment made at $187.67 has suffered a permanent loss. What must have happened? Three mechanisms in the filing could produce that outcome.
Commitments outrun demand. Mechanism: customers delay or cancel orders, which they can do "without penalty," while NVIDIA's supply commitments, substantially all to be paid "through fiscal year 2027" and only in some instances adjustable before firm orders, continue to arrive. Measure today: commitments of 95.2 billion, inventory of 21,403 million and 124.7 days, and a liability for excess purchase obligations of 2,739 million. Observable signal: days of inventory rising further, the excess purchase obligation liability growing, and provisions rising as a share of revenue from the 2.6% of FY2026.
The customer financing loop reverses. Mechanism: the AI model makers and early-stage partners that NVIDIA funds, guarantees and buys capacity from cannot raise further capital, and their purchases stop at the same time as the value of NVIDIA's stakes in them falls and guarantees are called. Measure today: 22,251 million of private equity and 3.5 billion of guarantees against 712 million of escrow. Two customers equal 36% of revenue. Observable signal: impairments on non-marketable securities rising from the 101 million of FY2026, receivable days lengthening, extended payment terms quantified in the filing, or the company entering the financing arrangements it says it has been asked for.
Regulation removes markets faster than the company replaces them. Mechanism: export controls widen beyond China, or China's antitrust finding leads to restrictions on the networking business that came with Mellanox. Measure today: China-headquartered revenue of 19,677 million (9.1%), networking revenue of 31,376 million, and customers headquartered outside the US at 31% of revenue. Observable signal: revenue outside the US falling further as a share, new inventory charges tied to licensing, and any penalty or order from the Chinese regulator.
All three would show first in the same lines: inventory and purchase obligations, the investee portfolio and the geographic mix of revenue.
What would the shareholder retain if growth stopped?
Tangible equity, which is equity less goodwill and intangibles, is 133,155 million, or $5.48 per year-end share. Net working capital is 93,442 million and the current ratio is 3.91. Cash and marketable securities are $2.57 per share; after gross debt including leases, $2.10. On the stricter liquidity basis of section 3, excluding current equity holdings, cash per share is $2.04. About 32.6% of assets is valued on observable prices and 28.8% on management estimates.
If revenue stopped growing and the operating margin returned to the average of the three years available, 58.97% against 60.38% in FY2026, the business would still generate large profits. In that case the protection would come from earnings, not assets. Net cash covers about 1% of the market capitalization. Inventory and receivables, the bulk of working capital, are exactly the assets whose value depends on demand holding at today's level.
The three questions set in 1-bis can now be answered with the figures already shown.
Does the build-up of inventory and commitments match demand? The filing allows a precise statement of the exposure, not an answer. Inventory doubled, the cash conversion cycle lengthened by 26 days, and commitments equal to a year and a half of cost of revenue fall due within FY2027 while customers can cancel orders. Provisions recur every year. The reading holds if FY2027 revenue absorbs the commitments without growth in the excess purchase obligation liability; it fails if that liability and inventory days rise together.
Who pays, and how much is financed by NVIDIA? Two direct customers equal 36% of revenue, against 23% for the largest two a year earlier. Alongside them stand the private stakes, investment commitments, lease guarantees and cloud contracts read together in 5-bis, some of them involving buyers of NVIDIA's products. The revenue these relationships generate is the most important figure the filing does not give. The reading holds while receivable days stay where they are and the stakes are not impaired; it fails if both move at once.
What did the operating cash buy per share? Mostly repurchases and securities, and increasingly stakes and a license whose returns are not disclosed. Repurchases at 36.3 times free cash flow per share cut the count by 0.71%; the Groq license is 85% goodwill. Per-share results kept pace with totals, but much of the buyback spending absorbed share-based pay.
At $187.67 the price equals 47.2 times FY2026 free cash flow, a 2.12% yield, and 2.89% of enterprise value in pre-tax operating income. It treats FY2026 cash generation as a base from which growth continues. That rests on demand absorbing commitments placed, in part, more than a year ahead, which the filing documents together with their one recent failure, and not on anything the filing shows about demand beyond FY2027.
How much revenue came from investees and from cloud providers NVIDIA buys from? How much of the 95.2 billion can be cancelled, and what was the total a year earlier? How large are supplier prepayments? How much of receivables is insured or on extended terms? What is in the 19,677 million of China-headquartered revenue? What headroom did the goodwill test show?
The FY2026 statements show an operating business with very high returns and real cash, funded entirely from inside and carrying no leverage. They also show resources committed on a large scale to the continuation of current demand, through suppliers, inventory, investees and partners, in a year when the largest customers are also competitors and orders can be cancelled. The statements document the returns; they do not document the permanence of the demand, nor the share of it that NVIDIA itself has helped to fund.
FY2027 has 53 weeks, which will lift reported growth by an amount the filing does not quantify.
Report based on the NVIDIA Corporation Form 10-K for the fiscal year ended January 25, 2026, filed with the SEC on February 25, 2026, and, where stated, on the 2026 Proxy Statement in the same Annual Review volume. Multiples use the supplied closing price of $187.67 on January 25, 2026 and the supplied 24.3 billion shares outstanding as of February 20, 2026. This report is for analysis only and does not constitute investment advice.
All inputs in US$ million unless stated. Year-on-year changes use the figures of Table A in the data tables file.
1.1 Compute & Networking share = 193,479 / 215,938 = 89.60%
1.2 Data Center share = 193,737 / 215,938 = 89.72%
1.3 Networking growth = 31,376 / 12,990 − 1 = +141.5%; compute growth = 162,361 / 102,196 − 1 = +58.9%
1.4 China growth = 19,677 / 25,048 − 1 = −21.4%
1.5 Private equity purchases: 17,502 (FY2026) vs 1,486 (FY2025), CF
1-bis.1 Revenue growth FY2025 = 130,497 / 60,922 − 1 = +114.2%; FY2026 = 215,938 / 130,497 − 1 = +65.5%
1-bis.2 R&D growth = 18,497 / 12,914 − 1 = +43.2%
1-bis.3 Top two direct customers = 22% + 14% = 36%; top three receivables = 25% + 18% + 13% = 56%
2.1 Gross margin FY2026 = 153,463 / 215,938 = 71.07%; FY2025 = 97,858 / 130,497 = 74.99%
2.2 Gross margin ex H20 = (153,463 + 4,500) / 215,938 = 73.15%
2.3 Opex / revenue FY2026 = 23,076 / 215,938 = 10.69%; FY2025 = 16,405 / 130,497 = 12.57%; FY2024 = 11,329 / 60,922 = 18.60%
2.4 Cost of revenue growth = 62,475 / 32,639 − 1 = +91.4%; SG&A growth = 4,579 / 3,491 − 1 = +31.2%
2.5 Operating income growth = 130,387 / 81,453 − 1 = +60.1%
2.6 R&D in the three years = 8,675 + 12,914 + 18,497 = 40,086
3.1 Equity gains / pre-tax income = 8,918 / 141,450 = 6.30%
3.2 Effective tax rate FY2026 = 21,383 / 141,450 = 15.117%; FY2025 = 11,146 / 84,026 = 13.265%; FY2024 = 4,058 / 33,818 = 12.00%
3.3 Net income ex equity gains FY2026 = (141,450 − 8,918) × (1 − 0.15117) = 112,497; FY2025 = (84,026 − 1,030) × (1 − 0.13265) = 71,987; growth = 112,497 / 71,987 − 1 = +56.3%
3.4 EPS ex gains = 112,497 / 24,514 = $4.589
3.5 Gross debt incl. leases = 8,468 + 2,944 = 11,412; net cash = 62,556 − 11,412 = 51,144; excl. leases = 62,556 − 8,468 = 54,088; FY2025 = 43,210 − 8,463 = 34,747
3.6 Available liquidity (excl. current equity) = 10,605 + 51,951 − 12,886 = 49,670; net of gross debt = 49,670 − 11,412 = 38,258
3.7 FCF = 102,718 − 6,042 = 96,676; FY2025 = 64,089 − 3,236 = 60,853; FY2024 = 28,090 − 1,069 = 27,021
3.8 FCF after SBC = 96,676 − 6,386 = 90,290; 60,853 − 4,737 = 56,116; 27,021 − 3,549 = 23,472
3.9 CFO / NI = 102,718 / 120,067 = 85.55%; 64,089 / 72,880 = 87.94%; 28,090 / 29,760 = 94.39%
3.10 Working capital change FY2026 = −15,399 − 11,324 + 577 + 3,096 + 5,257 + 1,844 = −15,949
3.11 Owner earnings before WC FY2026 = 120,067 + 2,843 − 8,918 − 1,424 − 287 − 6,042 = 106,239; FY2025 = 72,880 + 1,864 − 1,030 − 4,477 − 502 − 3,236 = 65,499; FY2024 = 29,760 + 1,508 − 238 − 2,489 − 278 − 1,069 = 27,194
3.12 Owner earnings after WC FY2026 = 106,239 − 15,949 = 90,290; FY2025 = 65,499 − 9,383 = 56,116; FY2024 = 27,194 − 3,722 = 23,472
3.13 Owner earnings before WC − FCF = 106,239 − 96,676 = 9,563 = 15,949 − 6,386
3.14 NOPAT FY2026 = 130,387 × (1 − 0.15117) = 110,676; FY2025 = 81,453 × (1 − 0.13265) = 70,648
3.15 Invested capital FY2026 = 157,293 + 8,468 − 62,556 − 22,251 − 4,840 = 76,114; FY2025 = 79,327 + 8,463 − 43,210 − 3,387 = 41,193
3.16 ROIC on average capital = 110,676 / ((76,114 + 41,193) / 2) = 110,676 / 58,654 = 188.7%; on year-end capital = 110,676 / 76,114 = 145.4%; FY2025 year-end = 70,648 / 41,193 = 171.5%
3.17 EBITDA = 130,387 + 2,843 = 133,230; FY2025 = 81,453 + 1,864 = 83,317
3.18 Gross debt / EBITDA = 11,412 / 133,230 = 0.086x
3.19 Interest coverage = 130,387 / 259 = 503.4x; FY2025 = 81,453 / 247 = 329.8x
3.20 Interest / operating income = 259 / 130,387 = 0.20%; long-term notes / NI = 7,469 / 120,067 = 0.062 years = 22.7 days
3.21 FCF / NI = 96,676 / 120,067 = 80.5%; 60,853 / 72,880 = 83.5%
3.22 Market cap = 187.67 × 24,300 = 4,560,381 ($4,560.4 billion)
3.23 EV = 4,560,381 + 8,468 + 2,944 − 62,556 = 4,509,237
3.24 P/E = 187.67 / 4.90 = 38.30x; ex gains = 187.67 / 4.589 = 40.89x
3.25 P/S = 4,560,381 / 215,938 = 21.12x; P/FCF = 4,560,381 / 96,676 = 47.17x; FCF yield = 96,676 / 4,560,381 = 2.12%; FCF after SBC yield = 90,290 / 4,560,381 = 1.98%
3.26 EV / EBITDA = 4,509,237 / 133,230 = 33.85x; EV / EBIT = 4,509,237 / 130,387 = 34.58x
3-bis.1 Inventory / total assets = 21,403 / 206,803 = 10.35%
3-bis.2 Commitments / cost of revenue = 95,200 / 62,475 = 1.52x; commitments / inventory = 95,200 / 21,403 = 4.45x
3-bis.3 Provisions = 4.0 + 3.2 = 7.2 billion; net of releases = 7.2 − 1.5 = 5.7 billion; 5,700 / 215,938 = 2.64% (company: 2.6%)
3-bis.4 Equity holdings / total assets = (22,251 + 17,726) / 206,803 = 19.33%
3-bis.5 Groq goodwill share = 14,400 / (14,400 + 2,500) = 85.2%
3-bis.6 Tax expense − cash taxes = 21,383 − 20,288 = 1,095
3-bis.7 Valuation allowance release / NI = 711 / 120,067 = 0.59%
3-bis.8 Customer program accruals growth = 5,318 / 4,880 − 1 = +9.0%
3-bis.9 Warranty additions / revenue = 2,474 / 215,938 = 1.15%; 1,203 / 130,497 = 0.92%; 278 / 60,922 = 0.46%; liability growth = 2,807 / 1,290 − 1 = +117.6%
3-bis.10 Cloud commitments / R&D = 27,000 / 18,497 = 1.46x
3-bis.11 Unearned SBC / NI = 14,800 / 120,067 = 12.3%
3-ter.1 Shares of total assets: marketable securities 51,951 / 206,803 = 25.1%; cash 10,605 / 206,803 = 5.1%; receivables 38,466 / 206,803 = 18.6%; goodwill 20,832 / 206,803 = 10.1%; non-marketable 22,251 / 206,803 = 10.8%; DTA 13,258 / 206,803 = 6.4%; PP&E 10,383 / 206,803 = 5.0%; accrued liabilities 21,352 / 206,803 = 10.3%
3-ter.2 Receivables growth = 38,466 / 23,065 − 1 = +66.8%; gross = 38,470 / 23,069 − 1 = +66.8%
3-ter.3 Inventory growth: total 21,403 / 10,080 − 1 = +112.3%; WIP 8,822 / 3,399 − 1 = +159.5%; finished 8,774 / 3,273 − 1 = +168.1%; raw 3,807 / 3,408 − 1 = +11.7%
3-ter.4 Accumulated depreciation / gross PP&E = 6,587 / 16,970 = 38.8%; 4,401 / 10,684 = 41.2%
3-ter.5 Other assets not broken down = 8,301 − 4,840 = 3,461
3-ter.6 DSO = 38,466 / 215,938 × 364 = 64.8; 23,065 / 130,497 × 364 = 64.3
3-ter.7 DIO = 21,403 / 62,475 × 364 = 124.7; 10,080 / 32,639 × 364 = 112.4
3-ter.8 DPO = 9,812 / 62,475 × 364 = 57.2; 6,310 / 32,639 × 364 = 70.4
3-ter.9 CCC = 64.8 + 124.7 − 57.2 = 132.4; 64.3 + 112.4 − 70.4 = 106.4 (computed on unrounded days)
3-ter.10 ROE on average equity = 120,067 / ((157,293 + 79,327) / 2) = 120,067 / 118,310 = 101.5%
3-ter.11 Repurchases added back: FY2026 157,293 + (9,746 + 34,015 + 40,388) = 241,442; FY2025 79,327 + (9,746 + 34,015) = 123,088; ROE = 120,067 / ((241,442 + 123,088) / 2) = 65.9%
3-ter.12 Distribution ratio = (974 + 40,388) / 120,067 = 34.4%
3-ter.13 Observable = 65,076 + (10,605 − 8,285) = 67,396; 67,396 / 206,803 = 32.6%
3-ter.14 Estimates = 22,251 + 20,832 + 3,306 + 13,258 = 59,647; 59,647 / 206,803 = 28.8%; FY2025 = (3,387 + 5,188 + 807 + 10,979) / 111,601 = 18.2%
3-ter.15 Remainder = 206,803 − 67,396 − 59,647 = 79,760; 38.6%
3-ter.16 Commitments not on balance sheet = 95.2 + 27 + 11.4 + 3.4 + 22.7 = 159.7 billion; total assets less cash and marketable securities = 206,803 − 62,556 = 144,247
3-quater.1 Receivables + inventory absorbed = 15,399 + 11,324 = 26,723
3-quater.2 Liabilities supplied = 3,096 + 5,257 + 1,844 = 10,197; / FCF = 10,197 / 96,676 = 10.5%
3-quater.3 Components: taxes payable 2,669 − 881 = 1,788; long-term tax payable 3,958 − 2,188 = 1,770; warranty 2,807 − 1,290 = 1,517; deferred revenue 2,572 − 1,813 = 759; excess purchase obligations 2,739 − 2,095 = 644
3-quater.4 Payables growth = 9,812 / 6,310 − 1 = +55.5%; cost of revenue growth = +91.4%
3-quater.5 FCF growth = 96,676 − 60,853 = 35,823; working capital deterioration = 15,949 − 9,383 = 6,566
3-quinquies.1 Per diluted share FY2026: revenue 215,938 / 24,514 = 8.809; NI 120,067 / 24,514 = 4.898; FCF 96,676 / 24,514 = 3.944; equity 157,293 / 24,514 = 6.416
3-quinquies.2 FY2025: 130,497 / 24,804 = 5.261; 72,880 / 24,804 = 2.938; 60,853 / 24,804 = 2.453; 79,327 / 24,804 = 3.198
3-quinquies.3 FY2024: 60,922 / 24,940 = 2.443; 29,760 / 24,940 = 1.193; 27,021 / 24,940 = 1.083; 42,978 / 24,940 = 1.723
3-quinquies.4 Change FY24→FY26: 8.809 / 2.443 = 3.61; 4.898 / 1.193 = 4.10; 3.944 / 1.083 = 3.64; 6.416 / 1.723 = 3.72
3-quinquies.5 Diluted shares change = 24,514 / 24,940 − 1 = −1.7%
3-quinquies.6 Incremental ROIC = (110,676 − 70,648) / (76,114 − 41,193) = 40,028 / 34,921 = 114.6%
3-quinquies.7 Reinvestment = 6,042 − 2,843 + 1,535 + 13,000 + 15,949 = 33,683; rate = 33,683 / 110,676 = 30.4%
3-quinquies.8 Implied growth = 30.4% × 188.7% = 57.4%; actual operating income growth = +60.1%
3-quinquies.9 Including private investments: (33,683 + 17,502 − 84) / 110,676 = 51,101 / 110,676 = 46.2%
3-quinquies.10 Distribution including withholding = (974 + 40,388 + 7,948) / 120,067 = 41.1%
3-quinquies.11 Cumulative FCF = 27,021 + 60,853 + 96,676 = 184,550; equity transactions = 1,537 − 83,325 − 17,661 = −99,449; debt = −2,500
3-quinquies.12 Capex / cumulative NI = 10,347 / 222,707 = 4.6%; capex / D&A = 1,069 / 1,508 = 0.71; 3,236 / 1,864 = 1.74; 6,042 / 2,843 = 2.13
3-quinquies.13 CFO − D&A = 102,718 − 2,843 = 99,875
3-quinquies.14 EBIT / EV = 130,387 / 4,509,237 = 2.89%
3-quinquies.15 Revenue increase FY24→FY26 = 215,938 − 60,922 = 155,016
3-sexies.1 Inventory vs revenue = 112.33 − 65.47 = +46.8 pts
3-sexies.2 Receivables vs revenue = 66.77 − 65.47 = +1.3 pts
3-sexies.3 Allowance (4 → 4 = 0.0%) vs gross receivables +66.8% = −66.8 pts
3-sexies.4 Payables vs cost of revenue = 55.50 − 91.41 = −35.9 pts
3-sexies.5 Warranty additions = 2,474 / 1,203 − 1 = +105.7%; vs revenue = +40.2 pts
3-sexies.6 CFO vs revenue FY2026 = 60.27 − 65.47 = −5.2 pts; FY2025 = 128.16 − 114.20 = +14.0 pts
3-septies.1 Inventory / cost of revenue = 21,403 / 62,475 = 34.3%
3-septies.2 R&D / revenue = 18,497 / 215,938 = 8.57%; 12,914 / 130,497 = 9.90%; 8,675 / 60,922 = 14.24%
4.1 China revenue change = 19,677 / 25,048 − 1 = −21.4%
5-bis.1 Three-year CFO = 28,090 + 64,089 + 102,718 = 194,897
5-bis.2 Shares of three-year CFO: repurchases 83,325 / 194,897 = 42.8%; withholding 17,661 / 194,897 = 9.1%; marketable net (85,402 − 47,855) = 37,547 / 194,897 = 19.3%; private net (19,850 − 256) = 19,594 / 194,897 = 10.1%; Groq 13,000 / 194,897 = 6.7%; capex 10,347 / 194,897 = 5.3%; acquisitions 2,625 / 194,897 = 1.3%; debt 2,500 / 194,897 = 1.3%; dividends 2,203 / 194,897 = 1.1%
5-bis.3 FY2026: (40,086 + 7,948) / 102,718 = 46.8%; three years (83,325 + 17,661) / 194,897 = 51.8%; (13,000 + 1,535 + 17,502 − 84) / 102,718 = 31.1%; FY2025 (1,007 + 1,486 − 171) / 64,089 = 3.6%; FY2024 (83 + 862 − 1) / 28,090 = 3.4%
5-bis.4 Marketable net FY2026 = 40,616 − 15,157 − 11,226 = 14,233
5-bis.5 Average repurchase price (cost) = 40,388 / 282 = $143.22; cash = 40,086 / 282 = $142.15; vs close = 143.22 / 187.67 − 1 = −23.7%
5-bis.6 Q4 weighted average = (5.6 × 198.89 + 6.6 × 179.41 + 7.3 × 186.52) / 19.5 = $187.67
5-bis.7 Multiple of FCF per share: FY2026 143.22 / 3.944 = 36.3x (yield 2.75%); FY2025 (34,015 / 310 = 109.73) / 2.453 = 44.7x (2.24%); FY2024 (9,746 / 211 = 46.19) / 1.083 = 42.6x (2.35%)
5-bis.8 FCF / repurchases = 96,676 / 40,086 = 2.41x
5-bis.9 Withholding price = 7,948 / 51 = $155.84
5-bis.10 Net issuance = 160 − 51 = 109; net change = 109 − 282 = −173; −173 / 24,477 = −0.71%; offset share = 109 / 282 = 38.7%
5-bis.11 Three-year spend = 84,149 + 17,661 = 101,810; share count change = 24,304 / 24,661 − 1 = −1.45%
5-bis.12 Non-GAAP exclusions = (4,737 + 602 − 3) + (6,386 + 471 + 56) = 5,336 + 6,913 = 12,249; SBC = 4,737 + 6,386 = 11,123; 12,249 / 120,067 = 10.2%
6.1 Groq goodwill amortized over five years (arithmetic only) = 14,400 / 5 = 2,880 per year
7.1 Networking / Data Center = 31,376 / 193,737 = 16.2%
8.1 215.9 / 130.0 − 1 = +66.1%; 215.9 / 190.0 − 1 = +13.6%; 137.3 / 71.0 − 1 = +93.4%; 137.3 / 120.0 − 1 = +14.4%; stretch reduction = 190.0 − 160.0 = 30.0 billion
8-ter.1 Tangible equity = 157,293 − 20,832 − 3,306 = 133,155; per share = 133,155 / 24,304 = $5.48
8-ter.2 Net working capital = 125,605 − 32,163 = 93,442; current ratio = 125,605 / 32,163 = 3.91
8-ter.3 Cash per share = 62,556 / 24,304 = $2.57; net of gross debt = 51,144 / 24,304 = $2.10; stricter = 49,670 / 24,304 = $2.04
8-ter.4 Average operating margin = (54.12% + 62.42% + 60.38%) / 3 = 58.97%
8-ter.5 Net cash / market cap = 51,144 / 4,560,381 = 1.1%
9.1 Top two customers FY2025 = 12% + 11% = 23%
The full data table behind this report — every line item with its source in the filing and the arithmetic checks — is published separately: NVIDIA Corporation FY2026 data table.