Q1 FY2027 results
| Metric | Result | Change |
|---|---|---|
| Total Revenue | $19.9 billion | up 298% year-over-year |
| Non-GAAP Gross Margin | 12.8% | up 330 basis points year-over-year |
| Non-GAAP Diluted EPS | $1.81 | Not stated |
| Enterprise and Channel Revenue | $4.9 billion | up 229% year-over-year |
| OEM Appliance and Large Data Center Revenue | $14.7 billion | up 32% year-over-year |
Guidance and outlook
- Q2 FY2027 revenue is expected to be $19.5 billion to $21.5 billion.
- Q2 FY2027 non-GAAP diluted EPS is expected to be $1.66 to $1.90.
- Full-year FY2027 revenue target is $72 billion to $82 billion.
- Full-year FY2027 gross margin is expected to be 11.8% to 12.2%.
How management sounded
Positive (+6 on our -10 to +10 scale). Management reported record revenue and raised full-year guidance, though they acknowledged ongoing supply chain constraints for key components. Management sounded more upbeat than on 8% of the 190 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Q&A summary
Revenue Outlook and Constraints
Asked: Goldman Sachs asked about visibility into offtakers and committed volume for projects.
Answer: Management emphasized that their Data Center Building Block Solutions outperform industry alternatives, helping them gain market share despite component shortages.
Customer Prepayments
Asked: Goldman Sachs asked how customer prepayments support working capital efficiency.
Answer: Management noted that high-quality customers pay quickly and provide strong cash flow, which helps fund working capital needs.
Gross Margin Dynamics
Asked: Loop Capital asked about the dynamics impacting gross margins for the rest of the year.
Answer: Management explained that the mix shift toward large AI deployments impacts margins, but they expect stability and potential expansion as they diversify their customer base.
Deferred Revenue
Asked: JPMorgan asked if there are still deferred deliveries remaining and why growth might moderate.
Answer: Management clarified that past deferred revenue was a one-time catch-up and that demand remains strong, with future growth gated by supply constraints and facility readiness.
What to watch before the next call
- Supply chain constraints for key components like GPUs.
- Customer facility readiness and data center shell availability.
- Concentration of revenue from the largest customer.
