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Nvidia has managed to significantly increase its revenue and market value over the last couple of years as a consequence of the AI boom, yet questions have arisen as around 39% of that money comes from just two mystery customers.
It's been a good few years for Jensen Huang, as the previously gaming-focused Nvidia has since become the king of the AI hardware world, allowing the company to become the world's most valuable business above even Apple.
Being the effective heart of the fastest growing technology in the world has allowed Nvidia to take a giant leap, as it holds a near monopoly in providing GPU chips that support the software of companies like OpenAI and Meta.
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While these companies do make up a significant amount of Nvidia's booming revenues, new reports have revealed that the company has two mystery customers that have supplied a staggering percentage of Nvidia sales, and nobody knows who they are.
As reported by CNBC, Nvidia's second-quarter filing with the Securities and Exchange Commission has revealed that 'Customer A' and 'Customer B' make up 39% of the business revenue within that period, and understandably it has raised concerns.
Breaking it down between the pair, the mysterious Customer A's purchases amounted to 23% of the company's revenue, whereas Customer B added an additional 16% on top of that.
This is a significant increase over the second quarter of 2024, which saw two customers make up 14% and 11% of the company's total revenue, and it has made people wonder whether the numbers generated by Nvidia are sustainable in the long term if they're so reliant on two 'individuals'.
Nvidia has attempted to dispel any concerns that might have cropped up following these wild percentages, writing in the filing: "We have experienced periods where we receive a significant amount of our revenue from a limited number of customers, and this trend may continue."
It has also outlined that 'large cloud service providers' comprised around 50% of the overall data center revenue, which in turn makes up 88% of Nvidia's total earnings in the reported period.
Intriguingly, while Nvidia understandably refuse to disclose the identities of the aforementioned Customer A and B, it has stated that they are 'direct customers', which refers to companies that buy Nvidia's chips to then build them into complete systems that are then sold on to data centers or cloud providers.
Don't expect these to be Meta or OpenAI then, as they're more than likely the businesses that then are selling systems made using Nvidia's products on as part of an AI food chain.
