Highlights:

• Nvidia’s automotive revenue surged 69% year over year to $586 million in Q2 fiscal 2026.

• The company began shipping its new DRIVE AGX Thor chip, powering its full-stack autonomous vehicle platform.

• Automakers including GM, Toyota, Mercedes, Volvo, and Tesla are expanding their use of Nvidia’s AV technologies.

• CEO Jensen Huang says the convergence of robotics, supercomputing, and self-driving could mark a multitrillion-dollar market opportunity.

Automotive Growth Accelerates Beyond Expectations

While Nvidia’s data center unit remains the centerpiece of its business, its automotive segment is quietly emerging as a critical growth engine. In its fiscal second quarter of 2026, Nvidia reported $586 million in auto revenue, marking a 69% increase from the prior year. The surge was driven largely by self-driving technology, particularly the launch of the company’s new DRIVE AGX Thor system-on-chip (SoC).

Thor, which succeeds Nvidia’s widely adopted Orin platform, represents the chipmaker’s most advanced AV computer to date. According to CFO Colette Kress, it is designed to handle the next generation of AI workloads across vision, language, and autonomy, positioning Nvidia at the forefront of vehicle digitization. The platform integrates hardware and software, creating a “full stack” that reduces reliance on third-party systems and offers automakers a turnkey solution for advanced driver assistance and autonomy.

Expanding Partnerships With Global Automakers

Nvidia’s customer roster in the automotive space is now a who’s who of global manufacturers. Toyota, the world’s largest automaker, recently announced it would incorporate Nvidia’s AV solutions, joining Mercedes-Benz, Volvo, BYD, and Foxconn, among others. Even Tesla, known for its vertically integrated strategy, leans on Nvidia.

Tesla uses Nvidia’s GPUs for supercomputing, a reliance that could deepen following its decision to scale back its in-house Dojo project. The shift underscores how Nvidia has positioned itself as a backbone provider of AI training systems, not only for vehicles but also for broader robotics and automation applications.

This diverse client base provides Nvidia with resilience across geographies and automaker strategies, while also reinforcing its credibility in a market where safety, scalability, and computing power are paramount.

Physical AI and the Road Ahead

Beyond near-term revenue gains, Nvidia’s leadership sees its automotive and robotics initiatives as central to what CEO Jensen Huang calls “physical AI.” This vision extends beyond cars, encompassing robots and machines that use AI to interact with the physical world. Huang has suggested that embodied AI could represent the first multitrillion-dollar robotics opportunity, with self-driving cars and autonomous robots leading adoption.

At CES, Huang emphasized that the intersection of supercomputing, robotics, and mobility could unlock unprecedented revenue potential. Partnerships with Tesla, including its robotaxi initiatives in Austin and the Optimus humanoid robot project, illustrate Nvidia’s integration into both consumer-facing and industrial AI ecosystems. Waymo, Alphabet’s autonomous vehicle arm, also relies on Nvidia chips to train its extensive models, further validating Nvidia’s centrality in the sector.

Strategic Outlook for Investors and Industry Stakeholders

For Nvidia, the automotive segment is no longer a peripheral experiment but a fast-scaling business with potential to reach billions in annual revenue. While $586 million this quarter represents only a fraction of its data center business, the growth trajectory suggests that Nvidia’s long-term forecast of $5 billion in annual automotive sales could be within reach.

Investors and industry observers will be watching two dynamics closely: the pace of adoption among global automakers and the regulatory landscape for autonomous vehicles. Both will shape how quickly Nvidia can monetize its AV platforms. If global acceptance of robotaxis accelerates, and if embodied AI continues to mature, Nvidia’s automotive bet may prove to be one of the most transformative chapters in its history.