Short Thought: Nvidia Ratchets Up the Risk

Welcome to one short thought. Just going through the Nvidia numbers. I would like to highlight for you one specific aspect of their financials that I find troubling.

The February 2026 Form 10-K shows purchase obligations at $95.2 billion, up from $16.1 billion the same time last year. This is because TSMC demanded longer term contracts and cash as it had to build out custom semiconductor fabrication and packaging capacity for NVDA’s new technology. That has not been the normal course of business until recently. It is a testament to the extremely complex monsters Nvidia’s “chips” have become.

NVDA also warns these obligations are “expected to continue to grow and become a greater portion of supply.”