Nvidia up 12% in 2026, barely keeping pace with S&P 500 despite record $81.6B revenue

Nvidia has experienced an extraordinary rise, with shares up 978% since late July 2021 as of July 22, 2026. However, the stock's pace of gains has slowed markedly. Year-to-date in 2026 (through July 22), Nvidia shares are up 12%, barely outpacing the S&P 500 index—a stark contrast to the company's prior-year performance: up 39% in 2025, 171% in 2024, and 239% in 2023.

Despite this stock slowdown, Nvidia's underlying business remains robust. In its fiscal 2026 second quarter ended April 26, the company reported revenue of $81.6 billion（約13兆円）, up 85% year over year and marking a fresh record. The surge is fueled by hyperscalers' aggressive spending on data center infrastructure for AI training and inference. Management projects substantial continued growth: CFO Colette Kress stated on the earnings call that "AI infrastructure spending is on track to reach $3 trillion（約480兆円） to $4 trillion（約640兆円） annually by the end of this decade."

Yet the market appears to be reconsidering the durability of Nvidia's success. One significant concern is that major hyperscalers—the company's most important customers—are developing custom chips in-house to reduce their dependence on Nvidia's GPUs. While demand remains strong today, this strategy represents a long-term risk as customers pursue an exit strategy. An additional uncertainty is whether AI-related capital expenditures will sustain their current levels if the ultimate returns fail to meet expectations.

Wall Street's consensus forecasts underscore the anticipated slowdown. Sell-side estimates call for revenue to increase 219% between fiscal 2026 and fiscal 2029, a significantly slower pace than the 700% growth achieved in the prior three years. Nvidia's shares currently trade 10% off their peak, at a forward price-to-earnings ratio of 23.6—representing only a 10% premium to the S&P 500 index, a modest valuation by historical standards for the company.

Nvidia's 12% gain in 2026 marks a dramatic deceleration from the stock's prior performance, where it jumped 239% in 2023, 171% in 2024, and 39% in 2025. The slowdown comes despite the company reporting record quarterly revenue of $81.6 billion（約13兆円） in its fiscal 2026 second quarter, with 85% year-over-year growth driven by hyperscalers' continued aggressive investment in AI data center infrastructure. The divergence between operational strength and stock performance suggests that investors have begun pricing in longer-term concerns about the durability of Nvidia's AI boom.

Two factors appear central to this repricing. First, major cloud providers and hyperscalers—Nvidia's largest customers—are actively developing custom silicon to reduce their reliance on Nvidia's GPUs. While demand remains robust today, this represents a structural threat to Nvidia's moat over the coming years. Second, sell-side analysts now expect revenue growth to decelerate to 219% between fiscal 2026 and fiscal 2029, a substantial slowdown from the 700% growth achieved in the prior three years. Both developments signal that the market views the extraordinary growth phase as finite. Management, through CFO Colette Kress, has noted that AI infrastructure spending is on track to reach $3 trillion（約480兆円） to $4 trillion（約640兆円） annually by decade's end—a large number, but one that implies a maturation of the market rather than perpetual acceleration.

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