Nvidia’s $20 Billion CPU Ambiguity and the Japanese Robot Gambit
Published on 07/26/2026 at 08:41 | Redaktion boerse-global.de
Nvidia’s share price ended the week at €182.00, down 0.8 percent, but the real story for investors lies buried in a single figure: nearly $20 billion. That is the revenue the company expects from its CPU business this fiscal year — a number that initially baffled the market until finance chief Colette Kress clarified what it actually covers.
The $20 billion target does not solely reflect standalone CPU servers. It also includes processors embedded within Nvidia’s Grace Blackwell and Vera Rubin superchip architectures. That distinction matters because it recalibrates how analysts interpret the company’s push into a market traditionally dominated by x86 incumbents and valued at roughly $200 billion. What the headline figure really signals is how deeply Nvidia’s own ARM-based chips have penetrated the broader data-center ecosystem.
A Slowing Rocket Still Outpaces Expectations
The stock has gained 13.55 percent since the start of the year — a respectable showing that pales against Nvidia’s own blistering history. In 2025 the shares climbed 39 percent, in 2024 they surged 171 percent, and in 2023 they exploded 239 percent. That trajectory has conditioned investors to expect extraordinary returns, and 2026 is delivering something far more mundane.
Operationally, the company remains in fine fettle. Revenue for the second quarter of fiscal 2026, which ended April 26, rose 85 percent year-on-year to $81.6 billion, beating even ambitious Wall Street forecasts. Yet the forward view tells a different story. Analysts project revenue growth of roughly 219 percent between fiscal 2026 and 2029 — a figure that would be remarkable for any company but represents a sharp deceleration from the roughly 700 percent expansion of the prior three years. The lower valuation, at 23 times expected earnings with projected annual profit growth of about 44 percent, reflects a more sober outlook rather than any fundamental business weakness.
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Jensen Huang Courts Japan’s Industrial Titans
The most significant catalyst this week came not from a product launch or earnings report but from a series of meetings in Japan. CEO Jensen Huang sat down with the heads of Toyota, Fujitsu, Kawasaki Heavy Industries, Fanuc, and Kioxia to discuss deploying “physical AI” in factory settings.
“The next frontier of AI lies in the physical world, and that is a once-in-a-lifetime opportunity for Japan,” Huang said. Three major robotics and automation players — Kawasaki, Fanuc, and Yaskawa — are already using Nvidia’s technology. The company has adjusted its reporting structure to make these new growth drivers more visible: the data-center business generated $75 billion in revenue last quarter, up 92 percent year-on-year, while the edge-computing segment, which includes robot training, grew 29 percent. For now, data centers remain the near-term price driver, with robotics positioned as a long-term bet that will take years to pay off.
Physical AI Takes Center Stage
At the SIGGRAPH conference in Los Angeles, held July 19–23, Nvidia shifted its messaging away from generative text and image models toward what it calls “Physical AI.” The flagship product is the Cosmos-3 Edge model, featuring 4 billion parameters and designed for robotics and autonomous systems at the network edge. The company also unveiled a Synthetic Video Detector, a microservice that can identify AI-generated video content with up to 92 percent accuracy. These software services are intended to generate high-margin, recurring revenue — a counterweight to the traditional hardware cycle of Blackwell and Rubin.
On July 21, Nvidia published technical details of the “Olympus” core architecture inside the Vera processor. The chip uses an 88-core design optimized for complex workflows in agent-based AI applications.
Hyperscaler Earnings as a Bellwether
Nvidia itself will report second-quarter results for fiscal 2027 on August 26. Before that, all eyes are on its biggest customers. Two hyperscaler heavyweights report next week: Microsoft on July 29, where investors will scrutinize AI-related capital expenditure within Azure, and Amazon on July 30, where the focus will be on AWS growth and the monetization of AI-powered cloud services.
The market wants confirmation that the enormous investments in AI hardware are translating into revenue growth at the cloud giants. That validation remains one of the most important valuation drivers for Nvidia’s own stock.
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A Backlog That Buys Time
A critical support for investor confidence is Nvidia’s order book. Current calculations show confirmed demand worth $1 trillion through 2027. Huang had previously mentioned roughly $500 billion in AI chip orders for 2025 and 2026 combined. These figures underscore how deeply entrenched the company’s customer relationships have become.
At current valuation levels, investors are paying no premium for the long-term potential of physical AI. The stock trades 0.65 percent above its 50-day moving average of €180.82, with a relative strength index of 52.6 — neutral territory after the spring’s volatility. It remains about 10 percent below the 52-week high of €202.50 set in mid-May.
Market technicians view the €180 level as both a psychological and technical support. Whether it holds will likely depend on the hyperscaler reports due July 29 and 30. If Microsoft and Amazon confirm that the estimated $1.5 trillion build-out of AI infrastructure through 2027 remains on track, Nvidia’s shares should find a floor. Until then, the Japanese robot courtship and the multi-year order backlog serve as the optimists’ primary arguments, while competitive pressure in the data-center market continues to draw close scrutiny.
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Nvidia Stock: New Analysis - 26 July
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