Nvidia Buys Two Years of Certainty with Two Quarters of Gross Margin

Nvidia provided revenue guidance for fiscal 2028 a full year ahead, projecting 70% growth, with Jensen Huang noting it could be higher without supply constraints. The cost: gross margin guidance was pressured down to 71%, and purchase commitments surged to $279 billion to lock in memory capacity. Sacrificing profit margins for capacity and revenue—certainty is bought with money. Additionally, Nvidia chose to proactively absorb cost increases, ceding profits to upstream and downstream partners to solidify the supply chain, at the expense of a heavier balance sheet.