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NVIDIA recently reported its Q2 earnings, highlighting that revenue from Singapore has reached a record high, second only to the US.
NVIDIA’s Revenue From Singapore Hits Around $10 Billion, Being Crucial for the Firm’s Business
According to NVIDIA’s financial statements, Singapore contributed approximately $10 billion to the total Q2 revenue, placing it just behind the US. This figure is significantly higher than Taiwan and China’s contributions.
While some retailers have claimed that AI chip diversions are occurring from Singapore, the reality is more nuanced.
Based on NVIDIA’s disclosures, Singapore revenue isn’t limited to the AI/DC segment; it also includes gaming and other streams. Several AIBs (Add-In Board manufacturers) like ZOTAC, Manli, and Inno3D have production facilities in Singapore, driving a portion of the revenue from gaming sales.
However, a significant part of this revenue is due to Singapore acting as a transshipment hub for centralized invoicing. According to NVIDIA’s 10-Q filing:
> “Singapore represented 22% and 21% of the second quarter and first half of fiscal year 2026 total revenue based on customer billing location, respectively. Customers use Singapore to centralize invoicing while our products are almost always shipped elsewhere.”
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There are several reasons for this setup:
– **Tax Efficiency:** Singapore offers favorable tax conditions.
– **Logistical Support:** The region provides robust logistical support.
– **Regulatory Strategies:** Companies like NVIDIA adopt strategies to manage revenue flows.
Under US GAAP accounting rules, revenue must be tied to entities issuing invoices. Therefore, sales are recorded in NVIDIA Singapore rather than the end-user’s location.
Regarding claims of AI chip diversions:
> “Over 99% of controlled Data Center compute revenue billed to Singapore was for orders from U.S.-based customers for the second quarter and first half of fiscal year 2026.”
This clarifies that there is no significant diversion of AI chips to China. NVIDIA Singapore acts as a redirect mechanism for DC or similar shipments, and there’s also demand from domestic firms.
It’s intriguing to see how crucial Singapore has become for NVIDIA. Apart from China, it might be the most important region for Jensen Huang.
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