In the first half of its fiscal 2027, the six months to 26 July 2026, Nvidia booked $23,707 million of gains from equity securities, net, against $141,410 million of income before income tax, according to its Form 10-Q. By our arithmetic, that is 16.8% of pretax profit. A year earlier the same line was $2,073 million of $53,117 million, or 3.9%.
Nvidia’s money now arrives through three layers: the countries its direct customers are headquartered in, a few direct customers that each account for a large share of revenue, and a growing book of stakes in other companies. The filing discloses all three.
Short explainer · Nvidia stake gains
A vertical news Short narrated from the headlines and opening lines of this piece and four related FourWeekMBA pieces on Nvidia. It goes public at 12:00 UTC on 30 October.
Business Pill · Concentration
An evergreen Business Engineer explainer on concentration: when a few big pieces make up most of a total. It teaches the general idea only and does not discuss Nvidia or any company in this piece.
The key insight: By our arithmetic from Nvidia’s 10-Q, gains from equity securities were 16.8% of its first-half pretax profit, against 3.9% a year earlier, and its marketable equity and non-marketable securities rose from $35.1 billion to $93.9 billion in six months.
Nvidia counts revenue by where its direct customers are headquartered. The 10-Q says “The end customer and shipping location may be different from our direct customers’ headquarters location”.
In the quarter to 26 July 2026, revenue was $96,221 million. United States-headquartered customers accounted for $60,074 million, Taiwan $26,985 million, China including Hong Kong $7,880 million and other regions $1,282 million. By our arithmetic, that is 62.4%, 28.0%, 8.2% and 1.3%.
A year earlier Taiwan-headquartered customers supplied $8,902 million of $46,743 million, or 19.0%. By our arithmetic, Taiwan revenue roughly tripled in a year. Our Taiwan piece sets out where that revenue ends up, our China piece has the China share quarter by quarter, and our piece on the new count explains why the China figure moved when Nvidia changed its method.
Nvidia balance-sheet lines on 25 January and 26 July 2026, from its Form 10-Q: marketable equity securities rose from $12.9 billion to $42.8 billion and non-marketable securities from $22.3 billion to $51.2 billion, faster than accounts receivable, inventories or cash. Multiples are our arithmetic.
Layer Two: Customer
The 10-Q says “one direct customer represented 16% of total revenue” in the second quarter. By our arithmetic, that is about $15.4 billion. In the first half, three direct customers represented 16%, 15% and 13% of total revenue, or 44% together.
A year earlier, in the second quarter of fiscal 2026, two direct customers represented 23% and 16% of total revenue.
Receivables are more concentrated still. Five direct customers accounted for 22%, 14%, 13%, 11% and 10% of the accounts receivable balance on 26 July 2026, or 70% by our arithmetic. Accounts receivable stood at $63,059 million, up from $38,466 million on 25 January.
The filing also says that for investment-grade customers Nvidia has provided, and may provide, “longer payment terms ranging from 90 days up to one year” to help with large data centre builds.
Behind the direct customers sit indirect ones. The 10-Q says “We estimate that one AI research and deployment company contributed a meaningful amount of our revenue by purchasing cloud services from our customers”. The filing does not name the company.
Layer Three: Stake
Nvidia’s balance sheet carried $42,783 million of marketable equity securities and $51,157 million of non-marketable securities on 26 July 2026, against $12,886 million and $22,251 million on 25 January. By our arithmetic, the two lines rose from $35.1 billion to $93.9 billion, about 2.7 times in six months.
The 10-Q says its non-marketable equity securities are “primarily in privately-held companies”. Net additions to those privately-held holdings were $31,005 million in the first half, and the filing records $7,504 million of unrealized gains on them. Of the publicly-held stakes, $36.9 billion was subject to short-term lock-up restrictions on the ability to sell.
Nvidia also had $3.3 billion of investments in infrastructure financiers accounted for using the equity method, with a maximum loss exposure, including future committed amounts, of $4.7 billion for those treated as variable interest entities. The filing says Nvidia “committed to make certain equity investments in AI model makers, infrastructure financiers, and other private companies”, subject to certain contingencies.
Two recent deals involve stakes and guarantees. Nvidia said on 26 October that it “will invest $3 billion in Meta’s equity offering”, and its release said Meta intends to expand the deployment of Nvidia infrastructure; our Meta piece has the terms. The Information reported on 29 October that Nvidia is in talks to provide Nscale with credit guarantees for debt on a 460-megawatt site that Anthropic plans to use; our Nscale piece covers it.
How the Layers Connect
The 10-Q says Nvidia has “entered into arrangements to assist select customers with securing the land, power, shell, and data center capacity needed to support their growth”. Reuters reported on 6 October that SpaceX was in talks to raise $40 billion to buy Nvidia chips; our SpaceX piece has the detail. Our capex piece covers how Alphabet, Amazon and Meta lined up about $325 billion of new debt and equity in 2026.
In the second quarter alone, gains from equity securities, net, were $7,771 million against income before income tax of $71,507 million, or 10.9% by our arithmetic. By our arithmetic, that leaves $15,936 million of the first-half gains in the first quarter.
The New York Times reported on 29 October that US officials believe Megaspeed executive Alice Huang is a Chinese asset who maintained a close relationship with Jensen Huang; an Nvidia spokesperson told CNBC that Megaspeed is one of its regional cloud customers. Our report has both sides.
The Structural Read
As we read the 10-Q, Nvidia’s revenue arrives through a few direct customers headquartered mainly in the United States and Taiwan, while the filing says end customers and shipping locations may differ.
As we read the filing, the stakes now sit beside the customers: Nvidia lists committed equity investments in AI model makers and infrastructure financiers, and arrangements to help select customers secure land, power, shell and data centre capacity.
By our arithmetic, five direct customers held 70% of Nvidia’s receivables on 26 July 2026, while one direct customer was 16% of second-quarter revenue.
NVIDIA Form 10-Q, quarter ended 26 July 2026
“We estimate that one AI research and deployment company contributed a meaningful amount of our revenue by purchasing cloud services from our customers”
Three Implications
FOR NVIDIA SHAREHOLDERS Gains on equity securities were 16.8% of first-half pretax profit by our arithmetic, and the 10-Q says publicly-held equity securities are subject to market price volatility.
FOR NVIDIA’S LARGEST BUYERS The 10-Q says investment-grade customers have been offered payment terms of 90 days up to one year for large data centre builds.
FOR READERS TRACKING GEOGRAPHY The 10-Q counts revenue by where direct customers are headquartered, so the country figures are not a map of where the chips are used.
The analysis puts it this way: “The inference economy is no longer a prediction.”
As we read it, Nvidia’s 10-Q shows the money side of that shift: a few direct customers carry large shares of revenue, and Nvidia holds growing stakes in companies across the stack. The analysis does not discuss the 10-Q figures in this piece.
What Is Not Established
Revenue by country reflects where direct customers are headquartered, not where chips are used. The 10-Q does not name its largest direct customers or the AI company it says contributed a meaningful amount of revenue. Gains on stakes are mostly unrealized and can reverse with market prices. The Nscale guarantees are reported talks. The shares, totals and multiples are our arithmetic.
This Week In The AI Supercycle
Execution Fault Lines, Concentrated Demand, and Geopolitical Firewalls
This week’s issue: the AI build is not short of demand for its parts. It is short of cheap money, and its end revenue rests on a narrow base of large, often venture-funded buyers.
Nvidia’s 10-Q shows revenue led by US- and Taiwan-headquartered customers, a few direct customers carrying large shares of revenue and receivables, and stakes that rose to $93.9 billion by our arithmetic. Gains on those stakes were 16.8% of first-half pretax profit, against 3.9% a year earlier.
A note on sourcing. This analysis draws on Nvidia’s Form 10-Q for the quarter ended 26 July 2026 and on our earlier reporting, which attributes Nvidia’s press release and The Information. Shares, totals and multiples are our arithmetic.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
