Nvidia Corp's latest quarterly filing contains a surprising twist beneath the headline-grabbing AI boom: the company lost more than half of its China business over the past year—and still managed to nearly double revenue.
According to Nvidia's Form 10-Q, revenue from customers headquartered in China, including Hong Kong, fell to $4.55 billion in the first quarter from $9.66 billion a year earlier. That's a decline of roughly 53%. Yet total revenue surged 85% year-over-year to a record $81.6 billion.
The filing highlights just how dramatically Nvidia's revenue base has shifted.
US AI Spending Fills The Gap
Sales to U.S.-based customers (i.e., Amazon, Alphabet, Meta Platforms and Microsoft) climbed to $63.8 billion during the quarter, up from $25.7 billion a year ago. That accounts for roughly 78% of Nvidia's total revenue, compared with about 58% in the same period last year.
The numbers suggest that surging AI infrastructure spending from hyperscalers, cloud providers and AI developers more than offset the sharp decline in China-related revenue.
Nvidia's newly disclosed market platform breakdown further underscores where demand is coming from. Data Center revenue soared to $75.2 billion, accounting for more than 92% of the company's total sales. Within that segment, revenue was almost evenly split between hyperscale customers and AI cloud, industrial and enterprise customers.
A New Concentration Risk Emerges
The filing also reveals another trend investors may want to watch.
Nvidia disclosed that three direct customers represented 21%, 17% and 16% of total revenue during the quarter. Combined, those three customers accounted for 54% of company-wide sales.
A year ago, Nvidia reported that only two direct customers accounted for 16% and 14% of revenue, respectively.
The company does not identify the customers, and direct customers can include cloud service providers, AI model developers, OEMs, ODMs and system integrators. Still, the disclosure suggests Nvidia's explosive growth is increasingly tied to a small group of giant AI spenders.
For investors, the latest filing offers a notable takeaway: Nvidia appears far less dependent on China than it was a year ago. But as one concentration risk fades, another may be taking shape, with a handful of customers now responsible for more than half of the AI giant's revenue.
Other countries where Nvidia does business include Saudi Arabia, which has partnered with Nvidia on sovereign AI "factory" initiatives, as well as the United Arab Emirates projects tied to G42 and Stargate UAE. Norway has also emerged as another potential AI infrastructure hotspot tied to Nvidia-powered megacluster development.
