Nvidia's Q2 Revenue Surge: Two Mystery Customers Account for 39% of $46.7 Billion

Nvidia says two mystery customers accounted for 39% of Q2 revenue | TechCrunch

Nearly 40% of Nvidia's second quarter revenue came from just two customers, according to a filing with the Securities and Exchange Commission. On Wednesday, Nvidia reported record revenue of $46.7 billion during the quarter that ended on July 27 -- a 56% year-over-year increase largely driven by the AI data center boom. However, subsequent reporting highlighted how much that growth seems to be coming from just a handful of customers. Specifically, Nvidia said that a single customer represented 23% of total Q2 revenue, while sales to another customer represented 16% of Q2 revenue. The filing does not identify either of these customers, only referring to them as "Customer A" and "Customer B." During the first half of the fiscal year, Nvidia says Customer A and Customer B accounted for 20% and 15% of total revenue, respectively. Four other customers accounted for 14%, 11%, another 11%, and 10% of Q2 revenue, Nvidia said. In its filing, the company says these are all "direct" customers -- such as original equipment manufacturers (OEMs), system integrators, or distributors -- who purchase their chips directly from Nvidia, such as. Indirect customers, such as cloud service providers and consumer internet companies, purchase Nvidia chips from these direct customers. In other words, it sounds unlikely that a big cloud provider like Microsoft, Oracle, Amazon, or Google might secretly be Customer A or Customer B -- though those companies may be indirectly responsible for that massive spending. In fact, Nvidia's Chief Financial Officer Nicole Kress said that "large cloud service providers" accounted for 50% of Nvidia's data center revenue, which in turn represented 88% of the company's total revenue, according to CNBC. What does this mean for Nvidia's future prospects? Gimme Credit analyst Dave Novosel told Fortune that while "concentration of revenue among such a small group of customers does present a significant risk," the good news is that "these customers have bountiful cash on hand, generate massive amounts of free cash flow, and are expected to spend lavishly on data centers over the next couple of years."

More than 50% of Nvidia's data center revenue comes from three customers -- $21.9 billion in sales recorded from the unnamed companies

How would you feel if just three customers made up nearly half of your sales? Nvidia just released its second-quarter earnings for 2025, which showed the company breaking its sales records. This is great news for the AI GPU giant and its investors, but the quarterly report also showed a risk that the company is taking. Business publication Sherwood noted that nearly 53% of the reported revenue for the Green Team's Data Center division comes from just three unnamed customers, totaling about $21.9 billion in sales. This is broken down to $9.5 billion from Customer A, $6.6 billion from Customer B, and $5.7 billion from Customer C. This might not sound like a problem -- after all, why complain if three different entities are handing you piles and piles of money -- but concentrating the majority of your sales to just a handful of clients could cause a sudden, unexpected issue. For example, the company's entire second-quarter revenue is around $46 billion, which means that Customer A makes up more than 20% of its sales. If this company were to suddenly vanish (say it decided to build its own chips, go with AMD, or a scandal forces it to cease operations), then it would have a massive impact on Nvidia's cash flow and operations. These scenarios are unlikely to happen soon, though, as investors are still bullish about AI tech, and Nvidia's competitors are still envious of the tech stack that the Green Team can offer. Still, resting the future of your company (especially one so big) on a narrow base will likely keep some executives awake at night. The company did not name which institutions were its biggest clients, but we can take a guess based on the plans and announcements that several big tech companies have made. One of the first that comes to mind is Elon Musk and xAI. The billionaire has previously broken data center records, setting up 100,000 Nvidia H200 GPUs in a record 19 days last year -- something that usually takes four years to finish, according to Nvidia CEO Jensen Huang. But more than that, Musk has dreams of running 50 million H100-equivalent GPUs in the next five years. OpenAI and Oracle also recently signed a deal to build a Stargate data center with over 2 million AI chips -- estimated to be equivalent to 5GW spread across 20 different data centers. Meta is also another big Nvidia customer that has recently been in the news, with Zuckerberg putting up data centers housed in tents and announcing plans for 'several multi-GW clusters', some of which are reportedly as large as Manhattan. Even though Nvidia is facing issues with its China sales, first when President Donald Trump banned its H20 chip -- resulting in a $5.5 billion write-off -- and second, when Beijing instructed Chinese companies to stop buying the chips a few weeks after Trump reopened the H20 taps to China once again, these numbers could mean that the company is still relatively safe from ruin, even if it loses complete access to the East Asian country. So, Nvidia's sales to these three companies are probably the reason why Huang can spend his time shuttling between Beijing and Washington, with his company seemingly being used as a political tool by both sides of the ongoing trade war.