Tech Perspective
Nvidia, ‘What Have You Done for Me Lately?’

By Daniel Morgan, Synovus Trust Senior Portfolio Manager
Synovus Trust Company, N.A.

Nvidia (NVDA) reported 2Q26 revenue and earnings per share (EPS) of $46.74 billion/$1.05 versus consensus of $46.05 billion/$1.01, with revenue growth of 56% Year over Year (YoY) versus estimates of 53%. Data Center (DC) revenue grew 56% YoY versus estimates of 57%, with no contribution from China in the 2Q26. Shipments of NVDA’s H20 GPUs for China customers were banned for most of the quarter, which was a $4 billion headwind to revenue. While the U.S. government approved export licenses for select customers in July, NVDA did not ship H20s to China, given that it remains a key bargaining tool in U.S.-China trade negotiations. The U.S. government also announced it would take 15% of future H20 revenue in exchange for export license approval. Blackwell Systems accounted for an estimated 80% of Data Center revenue (versus 70% of DC revenue in 1Q26), with Blackwell Ultra systems in full production and ramping in 2H25. Next Gen Rubin chips are also in the fab for shipment in FY26.

Guidance for the upcoming 3Q26 seemed to create a lot of confusion from investors. With management guiding 3Q26 revenue, implied EPS guidance was $54 billion/$1.25 versus consensus of $53.4 billion/$1.20, implying revenue growth of 55% as opposed to estimates of 53%. Guidance excludes China revenue in 3Q26, given export license uncertainty. Guidance for $54 billion ex-China compares to estimates from buy side analysts of $54-55 billion, including $3 billion plus China – which creates a clear upside excluding the China variable.

With China factored in for 3Q26, revenue could top on another $2.0-$5.0 billion in addition to the original $54 billion guide. The bar continues to be high, but the growth acceleration is clear. Post-earnings announcement and NVDA shares slumped. NVDA appears to have lulled investors to believe that every quarter will be another huge blowout! Like the February 2023 triple-digit growth quarter! At this point, even if NVDA’s earnings reports exceed estimates, it is not enough to satisfy investors!

Oracle’s Earnings: ‘Play it Again Sam!’

Oracle (ORCL) will report on September 9 its 1Q26 results after market-close, with the consensus now calling for EPS-GAAP of $1.03 on revenues of $15.053 billion. For FY2026, ORCL guided revenue growth of at least 16% versus the consensus of 14%, including Cloud services growth of 40% and Infrastructure growth of 70% YoY. ORCL’s revenue growth is set to accelerate, as its cloud business (44% of total) becomes a larger part of the mix, driven by growth in SaaS apps, Autonomous Database (AD) and new workloads moving to Oracle Cloud Infrastructure (OCI). OCI is gaining share of public cloud workloads, led by deployment flexibility, AD migrations and AI, in which ORCL has a performance and cost advantage.

In previous quarters, Oracle’s revenue growth had come up short of expectations, largely driven by ongoing constraints on Datacenter Buildouts. Confidence seems to be improving in FY26 as total revenues are targeted at $66 billion, and the aspirational goal set for 20% top-line growth in FY27. Oracle is a legacy enterprise software player that should continue to benefit from a favorable mix in the businesses – Cloud Apps, OCI and Strategic hardware. Greater than 70% of Oracle’s revenue is recurring and renewable, adding protection against severe downturns in IT software deal flow.

Over the past year, Oracle has posted strong RPO growth ($138 billion, 41% YoY) driven by solid infrastructure demand (core compute and genAI workloads). Oracle has done a lot of work convincing investors of the long-term value of its building RPO balance. With OCI demand continuing to outstrip supply, management expects CapEx to grow 20% in FY26 to $25 billion and more than double the number of MultiCloud data centers to 47 over the next 12 months.

Oracle is actively investing in building out data centers to support growth in its OCI solution. OCI is growing faster than its hyperscaler peers (ORCL’s OCI was 52% in 4Q25), albeit off a smaller base, and potentially taking market share from peers. During the last quarter (2Q25), revenues for competitors AWS grew 17.5%; Azure 39%; GCP 29.2%, significantly less than OCI’s growth of 52%. So ORCL could close the gap on GCP based on management’s estimate for total cloud growth for FY26 of more than 40%! Should Oracle’s OCI business maintain a high rate of growth for an extended period or growth accelerate, total revenue growth may be better than expected, which will likely impact shares positively.

Despite near-term headwinds in the technology sector, investors view Oracle shares (44.2% versus the S&P Info Tech Index 15.4 Year-to-Date) as a safe haven in unpredictable space! Many investors pointed to Oracle’s recent 4Q25 financial results a possible “watershed” moment? Whereby signaling the beginning of a new era of top-line growth acceleration driven by the cloud datacenter. Investors will be waiting for the upcoming 1Q26 results, hoping for further valuation of ORCL’s growth resurgence.