NVIDIA — High Margins Built by Price and Product MixNVIDIA NVDA | $227.98 | 1D +8.7% 1W +5.1% 1M +20.0% 3M +6.5%  For the quarter ended July 26, 2026, gross profit and operating income expanded sharply on higher revenue and average selling prices (ASP) • The margin came from pricing and product mix, not cost reduction • Revenue $96,221M (YoY +105.9%) grew faster than cost of sales $24,079M (YoY +86.8%), for a 75.0% gross margin • Operating margin 66.2% — operating expenses $8,408M (YoY +55.3%) grew far more slowly than revenue, so most of the gross margin carried down to the operating line • The 62.0% net margin can also be read at face value • Net income $59,688M (YoY +125.9%); other non-operating income $7,773M is small next to operating income $63,734M • Taxes $11,819M (YoY +147.1%) — growing faster than operating income (YoY +124.1%), i.e. the effective tax rate moved up • Single-segment concentration is the main risk; whether demand holds is the question • Compute & Networking 91.8%, Graphics 8.2% — the segment split is end-use diversification, not price diversification, so it does little to buffer an ASP decline • Bull case: if demand for AI data-center accelerators persists, pricing and mix hold and high margins can continue • Bear case: if supply expansion presses ASP down, margins revert. These margins are cyclically elevated; mean reversion is structural, but its timing is unknowable |