GoKawiilThis week, Nvidia released its Q1 2027 results, posting a record-breaking $81.65 billion in revenue thanks to sales of its AI and data center products. Colette Cress, chief financial officer of Nvidia, said that he expects sales of the company's Grace and Vera CPUs for data centers to hit $20 billion this fiscal year, thus outselling both AMD and Intel and becoming the world's largest supplier of processors by revenue. This is a realistic expectation, principal analyst and president of Mercury Research, Dean McCarron, tells Tom's Hardware Premium.
"Vera CPU opens a brand-new $200 billion TAM for Nvidia, a market we have never addressed before," Cress said during the company's conference call with financial analysts and investors. "Every major hyperscale and system maker is partnering with us to get it deployed. We have visibility to nearly $20 billion in total CPU revenue this year, setting us up to become the world-leading CPU supplier."
Nvidia later clarified that the $20 billion figure includes sales of Grace and Vera processors within Superchip combinations, NVL72 systems, and standalone CPUs sold either as racks aimed at agentic AI workloads or other applications.
(Image credit: Tom's Hardware)
Intel's data center and AI (DCAI) division's revenue totaled $16.8 billion last year, whereas AMD's data center unit earned $16.635 billion in 2025. While CPUs account for the lion's share of earnings of these business units, their sales are by far not 100% of their revenue, so actual sales of Xeon and EPYC products are well below $16 billion. The entire x86 server CPU market is worth around $30 billion. Therefore, the $20 billion figure would indeed approach two-thirds of the traditional server CPU market, making Nvidia the world's No. 1 server CPU supplier.
What makes Nvidia's statement especially remarkable is that while Grace CPUs are widely available and have shipped in huge quantities, its 88-core Vera CPU hasn't yet shipped in high volume. Furthermore, Nvidia has never meaningfully participated in mainstream server CPUs before. Given that Nvidia is poised to sell millions of Rubin data center GPUs, and every two of them will be attached to a Vera CPU, the company is almost guaranteed to sell plenty of CPUs.
"We will sell millions of Rubin GPUs and every two of them is connected to a Vera [CPU]," Jensen Huang, chief executive of Nvidia, told analysts and investors. "Vera is used in [four] ways. The first is Vera Rubin [platform containing two Rubin GPUs and one Vera CPU]. The second use case is Vera as a standalone CPU. The third is Vera with CX9 and its software stack for storage. The fourth is Vera with CX9 alongside a software stack for security, compute isolation, and confidential computing."
Conquering the CPU kingdom
Given the dominance of x86 servers, alongside AMD's EPYC and Intel's Xeon CPUs in particular, it is hard to imagine that another company can outsell these highly popular products. Yet, it is more than possible, given the fact that Nvidia can price its CPUs well above the average selling prices (ASPs) of other x86 offerings, and still manage to outsell competitors. This is because Nvidia sells vertically integrated platforms rather than standalone CPUs or GPUs. While Nvidia is not 'known' for its CPUs, it is definitely not a new entrant.
"Nvidia is in a unique situation, and I do not think we can really call them a 'new entrant," McCarron told Tom's Hardware Premium.
... continue reading