Collin Brantmeyer, The Motley Fool

Sun, Jun 1, 2025, 3:30 PM5 min read

• Nvidia just delivered another record-breaking quarter.

• The tech giant continues to face uncertainty stemming from geopolitical tensions and tariff whiplash.

• The stock surged 5% following its earnings release.

• 10 stocks we like better than Nvidia ›

Nvidia (NASDAQ: NVDA) just delivered another record-breaking quarter, sending its stock up 5% and tying Microsoft as the most valuable publicly traded company by market capitalization, at the time of this writing. Despite the strong results, questions linger as the company faces mounting geopolitical pressure and tariff uncertainty. Let's break down the chipmaker's latest performance and explore what the current challenges mean for long-term investors to determine whether Nvidia is a buy, hold, or sell.

For the first quarter of fiscal 2026, Nvidia reported $44.1 billion in revenue, representing a 69% year-over-year increase and a 12% increase from its previous quarter, fiscal Q4 2025. Nvidia's net income totaled $18.8 billion, a 26% increase year over year, despite the company incurring a $4.5 billion charge related to new U.S. export restrictions.

As for highlights, the company's data center revenue surged to $39.1 billion in the quarter, representing a 73% increase from the prior year. Management also announced that it will be building factories in the U.S. in partnership with others to produce artificial intelligence (AI) supercomputers, which may alleviate some tariff concerns.

Additionally, Nvidia continued to return capital to shareholders, with a modest quarterly dividend of $0.01 per share, and repurchased $14.1 billion worth of shares during the quarter. Notably, the management has spent $40 billion over the past 12 months on share buybacks, decreasing its share count by just 0.8% due to the company's massive $3.4 trillion market capitalization.

While Nvidia continues to break records, it encountered the aforementioned geopolitical hiccup during the quarter. On April 9, the U.S. government abruptly required Nvidia to secure a license before shipping H20 chips to China. The problem? H2O was already deeply embedded in the company's go-to-market strategy and had generated $4.6 billion in revenue during the quarter. Nvidia was left holding the bag on $4.5 billion worth of unsellable inventory and was unable to ship an additional $2.5 billion in orders before the restrictions took effect.

The China market, once seen as a dependable pillar of growth, now represents a major wildcard for Nvidia. With U.S. firms locked out, Nvidia warned that losing access to this near-$50 billion AI accelerator market would materially benefit foreign competitors.