Hello everyone! Today, let’s dive into some interesting news about Nvidia and what it means for its future. Grab a coffee, and let’s get started with some tech insights!

Nvidia recently reported a record quarter with revenue hitting $46.7 billion, a 56% increase compared to last year. This surge is mainly fueled by the booming AI data center market. But there’s a catch — most of this impressive growth comes from just a handful of big customers.

In detail, one customer alone contributed 23% of Nvidia’s total revenue for the quarter, while another accounted for 16%. The company only labels them as “Customer A” and “Customer B,” so their identities are a mystery. During the first half of the year, these two customers made up 20% and 15%, respectively, of Nvidia’s revenue.

Nvidia clarifies that these customers are “direct” buyers, such as OEMs and system integrators, not the huge cloud providers like Microsoft, Amazon, or Google. Interestingly, despite the ambiguity, Nvidia’s CFO Nicole Kress mentioned that large cloud companies made up 50% of data center sales, which form nearly 88% of Nvidia’s overall income.

What does this mean for Nvidia? Analysts like Dave Novosel warn that relying heavily on a small group of customers is risky. However, he also notes that these customers possess hefty cash flow and are expected to keep spending on data centers, which bodes well for Nvidia’s future.