Nvidia's Q1 profit jumps 628%. But is the heat catching up?

Nvidia just posted another knockout quarter. Revenue tripled, profit ballooned over six times and the AI chip king is still riding high. But after a meteoric stock run, even strong numbers might not be enough to keep the rally going.

Q1FY26 results snapshot

It also announced a 10-for-1 stock split effective June 7 and a $25 billion share buyback.

But here’s the rub

Nvidia’s valuation is sky-high. It trades at nearly 40x forward earnings, far richer than peers. With the stock already up over 220 per cent in the past year, any slowdown in AI spending or chip delays could rattle investors.

And while a stock split creates buzz, it doesn’t change the company’s intrinsic value.

What Nvidia does

Nvidia designs high-performance chips used in gaming, data centres and now, the booming AI industry. Its GPUs are the muscle behind most generative AI models and cloud infrastructure.

Here’s a summary of its fundamentals.

The bottom line

Nvidia remains a strong growth story. But it’s no longer cheap. Long-term believers in AI may still want in, but fresh buyers should be ready for volatility. This is not a buy-and-forget stock anymore. However, the road ahead might need more than just horsepower – it needs a price that justifies the thrill.

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Disclaimer: This is not a stock recommendation. This story was created with the assistance of artificial intelligence and is intended for informational purposes only. Please take it with a pinch of salt and do your own research or consult a financial advisor before making investment decisions.