Ahead of its widely anticipated fiscal second-quarter earnings report, due after markets close on August 27, Nvidia is drawing attention for a different reason: how much demand it can’t yet fill. According to analysis reported by 24/7 Wall St. on August 4, Nvidia’s forward supply commitments — essentially binding customer orders it has locked in but not yet shipped — surged to $119 billion, up from roughly $50 billion just two quarters earlier. The company has separately guided to second-quarter revenue near $91 billion, excluding China.
Why Scarcity Is the Story
The jump in forward commitments is significant because it flips the usual investor worry on its head. Rather than asking whether customers will keep buying, analysts are increasingly focused on whether Nvidia and its supply chain can produce chips fast enough to meet orders already on the books. CNBC commentator Jim Cramer said in early August that Nvidia chips remain scarce and are “holding value,” a framing that treats supply-side bottlenecks, not softening demand, as the binding constraint on near-term growth.
The Bottleneck Runs Through Taiwan and Memory Makers
That scarcity traces back to Nvidia’s supply chain. Taiwan Semiconductor Manufacturing Co.’s advanced N3 process node is severely capacity-constrained, and Nvidia is competing directly with Google’s custom chip programs for the same limited wafer capacity, pushing prices higher across the board, according to industry analysis cited by Nasdaq-focused outlets tracking the sector in early August. High-bandwidth memory, a specialized chip component essential to every AI accelerator, is another chokepoint: memory manufacturers have diverted capacity away from consumer DRAM production toward AI data center chips, driving up contract prices industry-wide — a dynamic Amazon separately cited in late July when it raised its own 2026 AI capital spending forecast to $220 billion. That memory squeeze illustrates how scarcity has spread beyond logic chips themselves: even companies with ample GPU supply can find themselves capacity-constrained if they can’t secure enough high-bandwidth memory to pair with those processors, turning what was once a single-component bottleneck into a multi-layered supply chain problem.
What Wall Street Expects From Earnings
Analysts polled ahead of the August 27 report expect Nvidia to post earnings of roughly $1.00 per share for the quarter, up about 47% from a year earlier, on revenue of nearly $46 billion — a year-over-year increase exceeding 53%. Nvidia’s board has also authorized an $80 billion share buyback program and raised its quarterly dividend to $0.25 per share, funded by $49 billion in single-quarter free cash flow, according to reporting on the company’s most recent results.
The Skeptical Counterpoint
Not every analyst treats the scarcity narrative as unambiguously bullish. Some strategists warn that chip scarcity driven partly by financing arrangements between Nvidia and its own large customers — rather than purely organic end-user demand — complicates the read on how sustainable current order books really are. That concern has been amplified by separate reporting on Nvidia’s discussions to guarantee financing for customers such as OpenAI, arrangements critics argue blur the line between genuine demand and vendor-supported purchasing.
Investors Are Also Watching Stock Volatility
Nvidia shares closed around $206.64 on August 3, down about 7.4% from levels near $223 after its Q1 fiscal 2027 filing in May, even as the stock gained roughly 7.4% over the prior week and is up about 13.4% year-to-date. That volatility underscores how sensitive the stock remains to shifting sentiment about AI capital spending broadly, even as the company’s own order book points to persistent scarcity rather than softening demand.
What’s Next
The August 27 earnings call will be the next major test of whether Nvidia’s supply-constrained narrative holds up against a market increasingly nervous about AI capex sustainability across the industry. If Nvidia confirms that forward commitments keep climbing while it struggles to expand output, that would support the scarcity thesis. Any sign that order growth is slowing, or that customers are delaying commitments amid the broader AI valuation debate roiling Wall Street, could quickly reshape the conversation around the world’s most valuable chipmaker. Analysts say the most important single line item to watch will be the change in forward supply commitments quarter over quarter, since a continued acceleration would offer the clearest evidence yet that scarcity, not softening enterprise appetite, remains the dominant force shaping Nvidia’s growth trajectory.