# Nvidia earns more than ever. The market punishes it harder than ever

> Nvidia posts record $68.1B revenue and loses $260B in market cap in a day. OpenAI closes the largest private round in history: $110B.

- Canonical: https://siliconvalleyconfidential.com/en/dossier/nvidia-earns-more-than-ever-the-market-punishes-it-harder-than-ever/
- Site: Silicon Valley Confidential (https://siliconvalleyconfidential.com) — weekly executive intelligence on Silicon Valley and global tech
- Author: Jose Luis Cases (https://es.linkedin.com/in/jose-luis-cases-lozano)
- Language: en
- Published: 2026-02-28 (original LinkedIn edition: https://www.linkedin.com/pulse/nvidia-gana-m%C3%A1s-que-nunca-el-mercado-la-castiga-jose-luis-cases-lolne/)

---
### MY TAKE

What a week... and Trump attacking Iran... let's get into it.

Nvidia has posted the best quarterly results in the history of the semiconductor industry. Revenue of $68.1 billion. Up 73% from a year ago. Guidance for next quarter of $78 billion, well above Wall Street's most optimistic expectations. The market's response was to strip $260 billion off its market cap in a day. A 5.5% drop. The stock's worst day since spring.

I need this to sink in.

The company that makes the most money...

.... selling the shovels of the AI gold rush publishes results any CEO on the planet would envy, and the market punishes it....

Because growing 73% is no longer enough. Because the previous quarter it grew 122%, and anything short of infinite acceleration is "deceleration."

We've built a market that demands the physically impossible and then acts surprised when it doesn't get it.

And meanwhile, supervillain Sam of OpenAI closes $110 billion, the largest private round in history, and Trump has blacklisted Anthropic for refusing to give the Pentagon unlimited access, as I covered last week.

An Australian company lays off 2,000 people saying "the era of manual coding is over" and its stock rises 11%, and we'll leave the Block story aside.

Meta signs $60 billion with AMD to stop depending on Nvidia. And Salesforce has to announce a $50 billion buyback to defend itself from the "SaaSpocalypse." The market rewards firing humans and punishes growing "only" 73%. That's where we are.

Thanks for reading. If this brings you value, share it. If you want more detail, keep reading.

### THE BOMBSHELL OF THE WEEK

### Nvidia breaks every record. Wall Street takes $260 billion off it in a day.

Let the numbers speak. And then let the reaction speak louder.

[Nvidia reported record quarterly revenue of $68.1 billion on Tuesday the 25th](https://www.cnbc.com/2026/02/25/nvidia-nvda-earnings-report-q4-2026.html)
, up 73% from a year ago. Earnings per share of $1.62 against the $1.54 Wall Street expected. It beat expectations by $2 billion. Guidance for next quarter: $78 billion, [well above even the buy-side's most optimistic estimates](https://247wallst.com/investing/2026/02/27/nvidia-beats-by-2-billion-and-guides-higher-but-wall-street-sells-anyway/)
. Data center accounted for 91% of revenue: $62.3 billion, above the $60.69 billion consensus expected.

And what did the stock do the next day? [It fell 5.5%, its worst day since last spring](https://www.cnbc.com/2026/02/26/nvidia-nvda-stock-price-q4-earnings.html)
. [$260 billion of market cap evaporated in one session](https://www.tradingkey.com/analysis/stocks/us-stocks/261628049-nvidia-nvda-earnings-q4-stock-price-investors-value-tradingkey)
. And it wasn't just Nvidia: it dragged down Broadcom, Oracle and CrowdStrike, each losing more than 2%. A [contagion effect Jefferies described as "the Nvidia paradox"](https://markets.financialcontent.com/stocks/article/marketminute-2026-2-27-the-nvidia-paradox-why-a-record-breaking-earnings-beat-triggered-an-ai-sector-contagion)
.

The pattern is clear: Wall Street no longer rewards excellence in AI. It demands infinite acceleration. When growth drops from 122% to 73%, even though it remains spectacular by any rational metric, the market reads it as deceleration. It's the trap of impossible expectations. The same mechanism that inflated the dot-com bubble: it doesn't matter how good you are, it matters whether you're better than what the market has already priced in.

What you won't read anywhere else: 91% of revenue comes from data centers, and just five cloud providers account for more than half of that. Two customers alone make up 36% of total sales. Hyperscalers remain the dominant category, with more than 50% of data center revenue. On top of that, Nvidia assumes zero China revenue in its forward guidance. Nvidia is not a diversified company. It's a monopoly with five customers and a geopolitical black hole where its second-largest market used to be.

The signal: if Nvidia can't satisfy Wall Street with these numbers, nobody can. The AI market no longer trades on fundamentals. It trades on narratives about the future, and narratives are insatiable.

### TRUMP BLACKLISTS ANTHROPIC: THE PENTAGON TREATS IT LIKE HUAWEI

### OpenAI signs with Defense hours later. 200 Google and OpenAI employees rebel.

This needs explaining properly because it's extraordinary.

Anthropic had a contract with the Department of Defense worth up to $200 million. It was the first AI company to deploy its models on the Pentagon's classified networks. But when it came time to renegotiate, Anthropic set two conditions: that its models not be used for [mass surveillance of American citizens or for autonomous weapons without human oversight](https://www.courant.com/2026/02/27/anthropic-pentagon-ai/)
. The Pentagon wanted unrestricted access for "all lawful uses."

On Friday the 27th, [President Trump ordered all federal agencies to stop using Anthropic products](https://www.cbsnews.com/video/trump-ends-federal-use-anthropic-ai-technology-threatens-further-action/)
. Defense Secretary Pete Hegseth went further: [he classified Anthropic as a supply chain risk to national security](https://www.axios.com/2026/02/27/anthropic-pentagon-supply-chain-risk-claude)
, the same designation used for companies from adversary countries. Days earlier, Hegseth had already [threatened to blacklist Anthropic over "woke AI"](https://www.npr.org/2026/02/24/nx-s1-5725327/pentagon-anthropic-hegseth-safety)
.

Anthropic [announced it will challenge the designation in court](https://sfstandard.com/2026/02/27/anthropic-trump-blacklist/)
, arguing it "would set a dangerous precedent for any American company negotiating with the government."

Hours later, Sam Altman posted on X that [OpenAI had closed a deal with the Pentagon](https://techcrunch.com/2026/02/28/openais-sam-altman-announces-pentagon-deal-with-technical-safeguards/)
 to deploy its models on classified networks. Altman says he [shares Anthropic's "red lines"](https://thehill.com/policy/technology/5758898-altman-backs-anthropic-pentagon-stand/)
 and that the deal includes "technical safeguards." According to [CNBC](https://www.cnbc.com/2026/02/27/openai-strikes-deal-with-pentagon-hours-after-rival-anthropic-was-blacklisted-by-trump.html)
, the deal prohibits mass surveillance and autonomous weapons, and includes OpenAI personnel deployed to oversee how the models are used.

Translation: OpenAI says it has the same principles as Anthropic, yet somehow got a deal Anthropic couldn't. That leaves two possibilities: either OpenAI's "technical safeguards" are looser than they sound, or the government has decided to make an example of Anthropic to discipline the rest of the sector. Probably both.

What you won't read anywhere else: more than [200 Google and OpenAI employees signed an open letter in solidarity with Anthropic](https://techcrunch.com/2026/02/27/employees-at-google-and-openai-support-anthropics-pentagon-stand-in-open-letter/)
, titled "We Will Not Be Divided," asking their own companies to uphold the same restrictions against mass surveillance and autonomous weapons. [According to The Hill](https://thehill.com/policy/technology/5759106-google-openai-anthropic-pentagon-ai/)
, hundreds of employees at both companies back Anthropic's stance.

Why it matters NOW: we are watching the exact moment when AI stops being a technology product and becomes a geostrategic asset. Companies that set conditions on its military use will pay a price. Those that don't will have to live with the consequences.

### OPENAI RAISES $110 BILLION AND BECOMES THE MOST EXPENSIVE STARTUP IN HISTORY

### Amazon puts in $50 billion, Nvidia $30 billion, SoftBank another $30 billion. Valuation: $840 billion.

[OpenAI closed the largest private funding round in history on Thursday the 27th](https://techcrunch.com/2026/02/27/openai-raises-110b-in-one-of-the-largest-private-funding-rounds-in-history/)
: $110 billion. Amazon leads with $50 billion ($15 billion upfront and $35 billion more when "certain conditions" are met), [Nvidia contributes $30 billion and SoftBank another $30 billion](https://www.cnbc.com/2026/02/27/open-ai-funding-round-amazon.html)
. The post-money valuation: [$840 billion](https://finance.yahoo.com/news/amazon-invest-50-billion-openai-133510892.html)
.

To put that in perspective: this values OpenAI at more than the GDP of the Netherlands. More than Nvidia two years ago. More than any privately held company in human history.

The Amazon deal goes beyond the check. [OpenAI is expanding its AWS agreement by an additional $100 billion over eight years](https://finance.yahoo.com/news/amazon-invest-50-billion-openai-133510892.html)
, including the use of Amazon's own AI chips. Translation: Amazon is not investing in OpenAI. Amazon is buying a position of mutual dependence that makes divorce impossible.

SoftBank now has [$64.6 billion invested in OpenAI, representing 13% of the company](https://www.investing.com/news/stock-market-news/openai-secures-110-billion-in-funding-at-730-billion-valuation-4531604)
. Masayoshi Son has bet more on a single AI company than most countries invest in their entire R&D.

The round remains open. More investors are expected in the coming weeks. The same day this round closes, OpenAI signs with the Pentagon and its rival is blacklisted by the government. The timing coincidence is no coincidence.

### OPENAI BRINGS IN THE CONSULTANTS: THE SAASPOCALYPSE GOES FORMAL

### McKinsey, BCG, Accenture and Capgemini sign multi-year alliances to sell AI to the Fortune 500

On Sunday the 23rd, [OpenAI announced "Frontier Alliances"](https://fortune.com/2026/02/23/openai-partners-with-mckinsey-bcg-accenture-and-capgemini-to-push-its-frontier-ai-agent-platform/)
: multi-year agreements with McKinsey, BCG, Accenture and Capgemini. These firms will certify dedicated teams on OpenAI technology, deploy joint engineers alongside consulting teams, and bring the Frontier platform directly into Fortune 500 accounts. The explicit pitch: replacing entire human departments with AI agents.

Why it matters NOW: the big consulting firms' model is being rebuilt around OpenAI. These firms have the enterprise relationships OpenAI doesn't. OpenAI has the AI capability these firms need to sell. It's a sales-channel move that could accelerate enterprise AI adoption by 2-3 years.

The SaaS companies' nightmare: imagine McKinsey walking into a $50 million Salesforce renewal and telling the CFO "we can replace those 200 seats with Frontier agents." That specific scenario explains the "SaaSpocalypse" Marc Benioff had to [defend against on Wednesday's earnings call](https://www.cnbc.com/2026/02/25/salesforce-crm-q4-earnings-report-2026.html)
.

### MONEY TALKS

### Google buys the battery that breathes: $1 billion to Form Energy

On Monday the 24th, it was announced that [Google has committed $1 billion to Form Energy](https://techcrunch.com/2026/02/26/google-paid-startup-form-energy-1b-for-its-massive-100-hour-battery/)
 for its iron-air battery technology for a new data center in Minnesota. The battery delivers 300 megawatts for 100 consecutive hours. It's the [largest battery in the world: 30 gigawatt-hours](https://pv-magazine-usa.com/2026/02/24/google-to-deploy-worlds-largest-iron-air-battery-for-minnesota-data-center/)
. It literally works by rusting iron: it breathes oxygen, generates electrons. 50-70% efficiency against lithium-ion's 90%, but at a fraction of the cost. Delivery expected in 2028.

AI's energy problem is no longer theoretical. Google is committing nine-figure checks to solve it. Form Energy is already planning a large round in late 2026 and an IPO in 2027.

### Meta signs $60 billion with AMD to stop depending on Nvidia

On Monday the 24th, Meta [closed a $60 billion, five-year agreement with AMD](https://www.cnbc.com/2026/02/24/meta-to-use-6gw-of-amd-gpus-days-after-expanded-nvidia-ai-chip-deal.html)
 to buy Instinct GPU chips with 6 gigawatts of capacity. The first deliveries, based on a customized version of the MI450 architecture, [will begin in the second half of 2026](https://www.trendsfocus.com/amd-and-meta-strike-60-billion-ai-chip-deal/)
. The deal includes warrants that [allow Meta to acquire up to 160 million AMD shares](https://www.bloomberg.com/news/articles/2026-02-24/meta-to-spend-tens-of-billions-of-dollars-on-amd-gear-buy-stock)
 at nominal price if milestones are met.

This came just days after Meta signed a multi-year agreement with Nvidia for millions of Blackwell and Rubin chips. Santosh Janardhan, Meta's head of infrastructure, was blunt: the scale of the operations "requires multiple chip suppliers." Nobody in Silicon Valley wants to be Jensen Huang's hostage.

### Wayve raises $1.2 billion for robotaxis in London

On Tuesday the 25th, British self-driving startup [Wayve closed a $1.2 billion Series D](https://techcrunch.com/2026/02/24/self-driving-tech-startup-wayve-raises-1-2b-from-nvidia-uber-and-three-automakers/)
 led by Eclipse, Balderton and SoftBank, with participation from Microsoft, Nvidia, Uber, Mercedes-Benz, Nissan and Stellantis. Valuation: [$8.6 billion](https://www.pymnts.com/news/investment-tracker/2026/wayve-raises-1-billion-dollars-preps-london-robotaxi-launch/)
. Uber has committed additional capital for multi-year deployments of Wayve robotaxis on the Uber network, starting with London this 2026.

### PRODUCT SECRETS

### Samsung launches the Galaxy S26 with agentic AI and a privacy display

On Tuesday the 25th, Samsung held [Galaxy Unpacked in San Francisco](https://news.samsung.com/global/samsung-unveils-galaxy-s26-series-the-most-intuitive-galaxy-ai-phone-yet)
 with the launch of the Galaxy S26, S26+ and S26 Ultra. The most relevant part isn't the hardware but the software: "Now Nudge" turns the phone into a proactive agent that checks your calendar, spots conflicts and suggests actions without being asked. Samsung has integrated [Bixby, Gemini and Perplexity as AI agents](https://blog.google/products-and-platforms/platforms/android/samsung-unpacked-2026/)
 running simultaneously on the same device. The "Privacy Display" on the S26 Ultra is the first screen that prevents others from seeing your content.

Translation: Samsung is betting that the future of the phone is a personal AI agent, not a screen for scrolling. We'll see if the market responds.

### Apple announces a launch week for March

Tim Cook has teased a ["big week"](https://tomsguide.com/phones/iphones/apple-reportedly-launching-at-least-5-products-over-three-days-in-early-march)
 on social media, with events in New York, Shanghai and London starting March 4. At least five products: an iPhone 17e with the A19 chip starting at $599, a budget MacBook (possibly in yellow and green), an iPad Air M4, and the start of Apple's smart home offensive.

The interesting part isn't the products. It's the format. Three cities, several days. Either there's an awful lot to announce, or Apple needs to generate a full week of media coverage to offset the sense that it's falling behind in AI.

### SK Hynix and SanDisk launch the HBF standard for AI storage

On [February 25, SK Hynix and SanDisk kicked off the global standardization process for HBF (High Bandwidth Flash)](https://news.aibase.com/news/25785)
, storage designed specifically for AI inference. This looks minor, but it isn't. AI's bottleneck is shifting from compute to data. Whoever controls the storage standard for inference will control the next cycle.

### REAL NUMBERS

### Salesforce: good numbers, but Benioff has to defend the castle

On Wednesday the 25th, [Salesforce reported Q4 results](https://www.cnbc.com/2026/02/25/salesforce-crm-q4-earnings-report-2026.html)
: revenue of $11.2 billion (+12% year over year), adjusted earnings per share of $3.81 (+37%). Agentforce's annualized revenue topped $800 million in the quarter. The stock rose 4% after the results.

But the revealing part was the defense. Benioff had to address the "SaaSpocalypse" head-on, announcing a [$50 billion share buyback](https://www.heygotrade.com/en/news/salesforce-jumped-4-post-earnings-but-that-50b-buyback-not-so-fast/)
 and saying the shares were trading at "low prices." When the CEO of the world's largest SaaS company needs a $50 billion buyback to reassure the market, AI's existential threat is not imaginary.

### WiseTech lays off 2,000 people: "the era of manually writing code is over"

On Monday the 24th, Australia's WiseTech Global [laid off 2,000 employees, 30% of its global workforce](https://www.bloomberg.com/news/articles/2026-02-24/wisetech-to-cut-2-000-jobs-as-ai-ends-era-of-manual-coding)
. CEO Zubin Appoo literally declared that "the era of manually writing code is over." The stock rose 11% after the announcement.

I read this and I need a moment. A company fires a third of its people saying humans are no longer needed to program, and the market rewards it with an 11% jump. This is a signal of what's coming for the entire software sector. It's not a prediction. It's a data point.

### THE DRAMA

### Microsoft activates its return-to-office mandate and doesn't have enough monitors

On Sunday the 23rd, [Microsoft activated its three-day in-office mandate](https://www.entrepreneur.com/business-news/microsoft-rto-mandate-to-begin-in-february-2026/496912)
 for Puget Sound-area employees living within 50 miles of an office. Satya Nadella justified it as ["necessary for innovation"](https://www.entrepreneur.com/business-news/microsoft-rto-mandate-to-begin-in-february-2026/496912)
 at a town hall.

The revealing detail: Mustafa Suleyman's AI group is under a stricter regime, [four mandatory days since January](https://www.windowscentral.com/software-apps/microsoft-mandates-return-to-office-claims-teams-and-all-remote-work-solutions-are-inferior)
. Nadella admitted the company "can do better" on empathy. Internal critics see it as what it probably is: a soft layoff designed to trigger voluntary resignations without severance.

### Trump summons Big Tech to the White House to sign an energy pact

In his State of the Union address on February 24, Trump unveiled the ["Rate Payer Protection Pledge"](https://www.tomshardware.com/tech-industry/big-tech/trump-orders-big-tech-to-generate-its-own-power-for-ai-data-centers-reveals-new-ratepayer-protection-pledge-to-curb-rising-electricity-prices-in-the-u-s)
: AI companies must fund the additional power generation they consume, rather than passing the cost on to citizens. [Amazon, Google, Meta, Microsoft, OpenAI, Oracle and xAI will go to the White House on March 4 to sign the pledge](https://www.axios.com/2026/02/25/trump-data-center-electricity-ratepayer-protection-pledge)
.

The irony: [Anthropic was one of the first to publicly back the initiative](https://cybernews.com/ai-news/white-house-ai-data-center-power-cost-pledge-microsoft-amazon-meta-anthropic/)
. The same week the government blacklists it, Anthropic commits to covering citizens' energy costs. I don't know if that's irony or class.

### Amjad Masad: the last contrarian left in Silicon Valley

On Thursday the 27th, [SF Standard published a long profile of Amjad Masad](https://sfstandard.com/pacific-standard-time/2026/02/27/pst-amjad-masad-silicon-valley-contrarian/)
, CEO of Replit (valued at $3 billion), titled "Silicon Valley's only contrarian." Masad, of Palestinian origin, says that "contrarianism in Silicon Valley is largely fake" and that he's probably the only one who speaks plainly even when it costs him business. A Replit investor confirmed that Masad's public stance has been "really challenging" and that "he's certainly lost business."

In a week where Anthropic pays the price for having principles and OpenAI signs with the Pentagon hours later, Masad's question resonates: is there anyone left in Silicon Valley willing to say no?

### THE WEEK AHEAD

March 4: Apple's launch week. iPhone 17e, budget MacBook, iPad Air M4. Three cities, multiple days. The first real test of the "Apple is back" narrative after ceding second place in market cap to Alphabet.

March 4: Signing of the "Rate Payer Protection Pledge" at the White House. Amazon, Google, Meta, Microsoft, OpenAI, Oracle and xAI. Big Tech's first formal commitment to funding its own AI energy costs.

March: Anthropic will challenge its designation as a national security risk in court. This case will define the relationship between AI companies and the American government for a generation. If Anthropic loses, no AI company will be able to refuse the Pentagon's demands.

Closing of the OpenAI round: The $110 billion round remains open. More investors are expected. The question is no longer how much money OpenAI raises, but how much is left for everyone else.

Thanks for reading.

Onwards