Nvidia Discloses Two Unidentified Clients Accounted for 39% of Q2 Revenue

Nearly 40% of Nvidia’s Q2 revenue came from just two clients, according to a report filed with the Securities and Exchange Commission.

On Wednesday, the semiconductor giant announced an unprecedented revenue of $46.7 billion for the quarter ending July 27, marking a 56% year-over-year growth, primarily driven by the escalating demand for AI data centers. However, subsequent analyses reveal that a significant share of this increase seems to be linked to a limited number of customers.

Specifically, Nvidia stated that one customer was responsible for 23% of the total Q2 revenue, while another accounted for 16%. The report does not disclose the names of these clients, referring to them simply as “Customer A” and “Customer B.”

For the first half of the fiscal year, Nvidia reported that Customer A and Customer B represented 20% and 15% of total revenue, respectively. Furthermore, four additional clients contributed 14%, 11%, another 11%, and 10% to Q2 revenues, as highlighted by the company.

The filing specifies that these are all “direct” customers—such as original equipment manufacturers (OEMs), system integrators, or distributors—who source their chips directly from Nvidia. Indirect clients, including cloud service providers and internet companies, obtain Nvidia chips through these direct clients.

This indicates that major cloud providers like Microsoft, Oracle, Amazon, or Google are unlikely to be Customer A or Customer B, although they may still be indirectly influencing that substantial spending.

Indeed, Nvidia’s Chief Financial Officer Nicole Kress pointed out that “large cloud service providers” made up 50% of Nvidia’s data center revenue, which represented 88% of the company’s total revenue, as reported by CNBC.

What does this mean for Nvidia’s future? Analyst Dave Novosel from Gimme Credit told Fortune that while “the concentration of revenue among such a small group of clients represents a significant risk,” the bright side is that “these clients have substantial cash reserves, produce considerable free cash flow, and are expected to invest heavily in data centers in the coming years.”