Nvidia tops estimates, supply squeeze

Nvidia’s latest quarter showed that demand for AI computing remains intense, but the latest disclosures from the company and its partners also pointed to what may limit the next leg of growth: how many systems and how much power can actually be brought online. Nvidia reported first-quarter fiscal 2027 revenue of $81.6 billion on May 20, up 85% from a year earlier, with data center revenue of $75.2 billion. IREN, the data center operator formerly known as Iris Energy, added a second datapoint on May 22 when it clarified the scope of its five-year Nvidia agreement. The company said the $3.4 billion contract covers 60 megawatts of gross power for Nvidia’s internal AI workloads using air-cooled Blackwell systems at its Childress, Texas campus. (investor.nvidia.com) ### How strong were Nvidia’s numbers? Nvidia said first-quarter revenue reached $81.6 billion for the period ended April 26, 2026, while data center revenue rose to $75.2 billion. The company also said it had authorized an additional $80 billion in share repurchases and raised its quarterly dividend to $0.25 a share from $0.01. (quiverquant.com) The company forecast second-quarter revenue of about $91 billion, according to earnings materials indexed on its investor site and transcript services covering the May 20 call. That outlook reinforced the scale of spending by cloud companies and other AI infrastructure buyers after several quarters of rapid expansion. (investor.nvidia.com) ### Why did the IREN contract matter? IREN announced on May 7 that it had signed a five-year AI infrastructure cloud services contract with Nvidia for internal AI and research workloads. The company said the agreement was the first step in a broader strategic partnership and tied the deployment to existing data center capacity in Childress. (seekingalpha.com) Quiver Quantitative reported on May 22 that IREN had clarified the contract’s scope after investor discussion around the deal. The clarification said the agreement covers 60 megawatts of gross power and uses air-cooled Blackwell systems, while leaving 390 megawatts of uncontracted capacity at Childress still available for other customers. (irisenergy.gcs-web.com) ### Where is the bottleneck showing up? The constraint showing up in current reporting is not a lack of buyers. Nvidia’s results and IREN’s contract both pointed to continued demand for large AI clusters, while outside coverage of the earnings reaction focused on whether supply of chips, servers and power can keep pace. (quiverquant.com) Capacity Global reported on May 8 that Nvidia and IREN were targeting as much as 5 gigawatts of AI infrastructure under a broader partnership, including a warrant that could let Nvidia invest up to $2.1 billion in IREN. That scale underscored how the AI buildout is now tied to land, electricity and data center construction as much as to semiconductors. (investor.nvidia.com) ### Why are investors also watching companies beyond Nvidia? IREN said in its May 7 business update that it remained on track to reach $3.7 billion of annualized run-rate revenue by the end of calendar 2026. The company also said it was building toward 1.2 gigawatts of AI cloud capacity in 2027 and pursuing expansion across North America, Europe and Asia-Pacific after that. (capacityglobal.com) That buildout has helped keep attention on companies that can supply adjacent parts of the stack, including compute, hosting and power. In current market coverage, AMD has been cited alongside data center and infrastructure operators as investors look for beneficiaries when Nvidia demand remains high but deployment depends on broader system capacity. (irisenergy.gcs-web.com) ### What comes next in the next few quarters? IREN said the Nvidia contract is targeting ramp-up from early 2027, while the company’s broader expansion plans call for 1.2 gigawatts of AI cloud capacity in build during 2027. Nvidia’s next near-term milestone is its second quarter, for which it forecast about $91 billion in revenue. (sec.gov) (seekingalpha.com)