What we heard
Health Care
Veeva took direct aim at Salesforce, claiming over 180 customers are live on its CRM AI while its rival has zero large deployments live. It signals widening execution divergence in vertical enterprise software.
Technology
Snowflake trimmed full-year product gross margin guidance to 74% due to a rising mix of lower-margin AI workloads. It offers clear evidence of the margin dilution software vendors face as AI compute scales.
Consumer Discretionary
Consumer discretionary spending diverged sharply as Lululemon’s comparable sales fell 10% while Williams-Sonoma’s grew 6.2% across every brand. The contrast underscores that company-specific execution is dominating broad macro trends.
One-off tariff refunds delivered a 560-basis-point boost to Lululemon’s operating margin and $34 million to Best Buy. These windfalls temporarily masked underlying operational deleverage and weakening core demand.
Information Technology
HPE and Broadcom warned that soaring demand for High Bandwidth Memory in AI racks is straining supply and competing with standard DRAM. This shows memory bottlenecks extending beyond GPUs into broader hardware configurations.
Dell reported traditional server revenue up 122% with over 10 points of share gains, while HPE saw traditional server unit volume constrained by supply. The gap highlights accelerating share shifts in enterprise compute infrastructure.
Nvidia signaled that gross margins will trough at 71% to 72% in Q4 before stabilizing at 72% to 73% next fiscal year. This establishes a clear margin baseline through the transition to next-generation architectures.
In detail
Health Care
Veeva took direct aim at Salesforce, claiming over 180 customers are live on its CRM AI while its rival has zero large deployments live. It signals widening execution divergence in vertical enterprise software.
Enterprise adoption in vertical customer relationship management is increasingly defined by deployment track records. As software providers race to activate artificial intelligence capabilities for corporate clients, operational execution determines which platforms move beyond pilot phases into full production. A large customer enabling automated tools across its entire field force demonstrates that real-world utilization is already underway. This operational progress highlights the divergence between vendors completing enterprise-scale rollouts and competitors struggling to bring major implementations live, ultimately impacting how rapidly field organizations can modernize workflows.
Yes. It’s based on our execution and what we’re seeing with Salesforce as well. I think Peter alluded to earlier how Salesforce has been struggling with some of the larger projects that they have, and they don’t really have any customers live. And when you look at what Veeva is doing, it contrasts pretty significantly. We have over 180 customers live. We have customers that are turning AI on. We had a big milestone in CRM this quarter where one of our top 20 turned AI on in CRM for their entire field force. So really significant milestone.
VEEV — Paul Shawah, EVP, Strategy (FY2027-Q2) — read it in the call
Technology
Snowflake trimmed full-year product gross margin guidance to 74% due to a rising mix of lower-margin AI workloads. It offers clear evidence of the margin dilution software vendors face as AI compute scales.
Rapid adoption of artificial intelligence capabilities is reshaping the financial profiles of cloud data platforms. While customer demand for modern computational workloads continues to expand swiftly, these offerings currently yield lower contribution margins than established product lines. As client usage shifts toward these newer workloads, the changing revenue composition exerts downward pressure on overall profitability. Future margin trajectory will depend on whether infrastructure efficiencies, pricing adjustments, or scaling benefits can eventually lift contribution rates on these newer workloads to match the profitability of legacy offerings.
For FY 2027, we now expect 74% non GAAP product gross margin. This revised outlook includes a higher revenue mix from fast growing AI workloads which carry a lower contribution margin today.
SNOW — Brian G. Robins, Chief Financial Officer (FY2027-Q2) — read it in the call
Consumer Discretionary
Consumer discretionary spending diverged sharply as Lululemon’s comparable sales fell 10% while Williams-Sonoma’s grew 6.2% across every brand. The contrast underscores that company-specific execution is dominating broad macro trends.
Recent retail results reveal stark performance differences across the consumer discretionary landscape, demonstrating that operational execution outweighs broader economic conditions. While one retailer saw quarterly net revenue drop alongside a double-digit decline in comparable sales, another achieved revenue expansion and positive comparable sales growth spanning all of its individual brands and sales channels. This growing divergence indicates that merchant success is increasingly dictated by brand-specific strategies and channel execution rather than uniform consumer headwinds, determining which retailers can sustain momentum when customer spending patterns become selective.
For Q2, total net revenue decreased 4% or 5% in constant currency to $2.4 billion and comparable sales decreased 10%.
LULU — Meghan Frank, Interim Co-CEO and CFO (FY2026-Q2) — read it in the call
Our comp for Q2 came in at 6.2% with total revenue growth of 6.7%. This performance reflects strong execution by all of our brands across all of our channels and the hard work of our dedicated teams.
WSM — Laura Alber, President and Chief Executive Officer (FY2027-Q2) — read it in the call
One-off tariff refunds delivered a 560-basis-point boost to Lululemon’s operating margin and $34 million to Best Buy. These windfalls temporarily masked underlying operational deleverage and weakening core demand.
Non-recurring regulatory recoveries recently provided substantial financial cushions for major consumer retailers, altering their reported profitability metrics. One retailer captured a significant pretax refund under trade statutes that contributed hundreds of basis points to its operating margin, while another outpaced profit expectations partly through tens of millions of dollars in customs reimbursements. These external windfalls temporarily buoy financial results against underlying cost pressures and margin compression. Future quarters without such one-time credits will offer a clearer assessment of baseline operating profitability and retail demand fundamentals.
Operating income for the quarter was $454 million, or 18.8% of net revenue, compared to 20.7% of net revenue in Q2 2025. This result includes $134.5 million pretax benefit from IEEPA tariff refunds, which added 560 basis points to operating margin.
LULU — Meghan Frank, Interim Co-CEO and CFO (FY2026-Q2) — read it in the call
Our adjusted operating income rate of 4.3% was also better than planned, driven by a higher gross profit rate that included a $34 million benefit from tariff refunds.
BBY — Corie Barry, CEO (FY2027-Q2) — read it in the call
Information Technology
HPE and Broadcom warned that soaring demand for High Bandwidth Memory in AI racks is straining supply and competing with standard DRAM. This shows memory bottlenecks extending beyond GPUs into broader hardware configurations.
The rapid scaling of advanced computing architectures is creating structural pressures across the semiconductor memory ecosystem. High-bandwidth memory required for graphics processing units is consuming significant wafer and clean-room capacity, influencing the available supply mix for traditional dynamic random-access memory. At the same time, customers assembling artificial intelligence server racks must independently secure both specialized high-bandwidth components and standard system memory. If manufacturing bottlenecks intensify, supply constraints could disrupt traditional server build cycles and complicate hardware delivery schedules across standard enterprise data center infrastructure.
But in the memory space, you also have another trend underneath that obviously is driven by the technology shift. We had DDR4 to DDR5, that’s understood, but then you have traditional DRAM moving to HBM. And that HBM demand is super high because it’s driven by the GPU and the better memory that comes with it. So this is why you have to look at this wafer capacity, clean room capacity and then eventually the mix of what type of memory will be used and demanded as we go forward. Now in the traditional server, we use DRAM. We don’t use HBMs. And so that’s where we are focused very extensively. On
HPE — Antonio Neri, President and Chief Executive Officer (FY2026-Q3) — read it in the call
we all know about memory, HBM memory, and beyond HBM memory, the system memory that goes into AI servers, which we don’t supply necessarily, but our customers have to secure too.
AVGO — Hock Tan, President and CEO (FY2026-Q3) — read it in the call
Dell reported traditional server revenue up 122% with over 10 points of share gains, while HPE saw traditional server unit volume constrained by supply. The gap highlights accelerating share shifts in enterprise compute infrastructure.
Enterprise data center spending is expanding across traditional server lines, driven by infrastructure refresh cycles, enhanced security requirements, and the rising compute needs of agentic workflows. However, server vendors are navigating this demand surge with markedly different operational outcomes. While one hardware provider achieved triple-digit revenue expansion fueled by existing clients modernizing compute infrastructure, another relied on higher average selling prices to compensate for constrained unit shipment volumes. Sustained enterprise demand will test whether component availability and supply chain execution enable suppliers to capture full volume potential.
Moving to traditional servers. Revenue was up 122% as demand remains exceptionally strong, supported by multiple vectors of growth. First, a majority of our growth is coming from existing customers as they continue to refresh and modernize their data centers to support traditional workloads. Heightened security and resiliency requirements are also creating incremental demand as customers modernize their infrastructure. Second, we are seeing a growing trend of customers that require meaningful CPU compute capacity to support AI and agentic workflows. These workloads are creating incremental dem
DELL — Jeffrey Clarke, CEO (FY2027-Q2) — read it in the call
Server revenue growth of 35% accelerated sequentially as strong ASP growth in traditional servers offset supply-constrained unit volumes.
HPE — Marie Myers, Chief Financial Officer (FY2026-Q3) — read it in the call
Nvidia signaled that gross margins will trough at 71% to 72% in Q4 before stabilizing at 72% to 73% next fiscal year. This establishes a clear margin baseline through the transition to next-generation architectures.
Leading technology hardware and networking providers are mapping out profitability baselines as they navigate product transitions and scaling operational leverage. Projections indicate gross margins will reach an interim low in the fourth quarter before stabilizing into a predictable multi-year range, while enterprise storage and optical networking suppliers are managing slight margin improvements and raised annual outlooks. Clear forward guidance helps investors gauge how architecture shifts, component costs, and revenue growth translate into operating leverage across enterprise hardware and semiconductor product cycles.
For Q3, we expect GAAP and non-GAAP gross margins to be 74% plus or minus 50 basis points. We expect margins to bottom in Q4 in the 71% to 72% range before settling at 72% to 73% in fiscal year ‘28
NVDA — Colette Kress, Executive Vice President and Chief Financial Officer (FY2027-Q2) — read it in the call
We expect adjusted gross margins of 45% plus or minus 50 basis points, bringing the year to a similar range a raise of 50 basis points from last quarter.
CIEN — Marc D. Graff, CFO (FY2026-Q3) — read it in the call
Regardless, we expect Q4 operating margin to be approximately 66%, flat from a year ago because our strong revenue growth drives substantial operating leverage.
AVGO — Amie O’Toole, Chief Financial Officer (FY2026-Q3) — read it in the call
We said that we would see a trough in Q1, and we anticipate a slight improvement for the rest of the year or gradual improvement for the rest of the year. Now fast forward to today, we did manage Q1 product gross margin in a really great way. I think we did a great job in execution and we outperformed our expectations for Q1. So that’s sort of the first point I want to make. The second point is when we compare now Q2 to Q4 for the rest of the year to where it was 90 days ago, we’re now expecting it to be slightly better. So if you think of the prior guidance had product gross margin in sort of
NTAP — Wissam Jabre, CFO (FY2027-Q1) — read it in the call
Coming up
2026-09-10 · ORACLE CORP (ORCL) — Oracle Cloud Infrastructure (OCI) revenue growth rate and remaining performance obligations (RPO) from AI workloads.
2026-09-10 · ADOBE INC. (ADBE) — Digital Media net new annual recurring revenue (ARR) and direct monetization metrics from generative AI tools like Firefly. — our analysis
2026-09-17 · FEDEX CORP (FDX) — Express segment operating margins and structural cost reductions realized under the DRIVE network consolidation program. — our analysis
2026-09-11 · KROGER CO (KR) — Identical supermarket sales excluding fuel alongside commentary on the Albertsons merger proceedings. — our analysis
2026-09-10 · COPART INC (CPRT) — Global unit auction volume growth and insurance carrier total loss assignment rates. — our analysis
2026-09-08 · CASEYS GENERAL STORES INC (CASY) — Inside same-store sales performance and fuel margin cents per gallon. — our analysis
2026-09-16 · LENNAR CORP /NEW/ (LEN) — Net new order volumes and the extent of price concessions or mortgage rate buydowns impacting homebuilding gross margins. — our analysis
2026-09-09 · COOPER COMPANIES, INC. (COO) — Organic revenue growth in daily silicone hydrogel contact lenses and CooperSurgical fertility portfolio demand. — our analysis
Companies that reported this period
29 earnings calls held between 2026-08-23 and 2026-09-06.
2026-08-25 · INTU — FY2026-Q4
2026-08-26 · A — FY2026-Q3
2026-08-26 · Salesforce, Inc. (CRM) — FY2027-Q2
2026-08-26 · CrowdStrike Holdings, Inc. (CRWD) — FY2027-Q2
2026-08-26 · HPQ — FY2026-Q3
2026-08-26 · NVIDIA CORP (NVDA) — FY2027-Q2
2026-08-26 · SJM — FY2027-Q1
2026-08-26 · SNPS — FY2026-Q3
2026-08-26 · VEEV — FY2027-Q2
2026-08-26 · WSM — FY2027-Q2
2026-08-27 · ADSK — FY2027-Q2
2026-08-27 · BBY — FY2027-Q2
2026-08-27 · DG — FY2027-Q2
2026-08-27 · DLTR — FY2027-Q2
2026-08-27 · HRL — FY2026-Q3
2026-08-27 · MRVL — FY2027-Q2
2026-08-27 · ULTA — FY2026-Q2
2026-08-27 · WDAY — FY2027-Q2
2026-09-01 · Credo Technology Group Holding Ltd (CRDO) — FY2027-Q1
2026-09-01 · Dell Technologies Inc. (DELL) — FY2027-Q2
2026-09-01 · Medtronic plc (MDT) — FY2027-Q1
2026-09-01 · Palo Alto Networks Inc (PANW) — FY2026-Q4
2026-09-02 · Broadcom Inc. (AVGO) — FY2026-Q3
2026-09-02 · BROWN FORMAN CORP (BF-B) — FY2027-Q1
2026-09-02 · Hewlett Packard Enterprise Co (HPE) — FY2026-Q3
2026-09-02 · NetApp, Inc. (NTAP) — FY2027-Q1
2026-09-02 · Snowflake Inc. (SNOW) — FY2027-Q2
2026-09-03 · CIENA CORP (CIEN) — FY2026-Q3
2026-09-03 · lululemon athletica inc. (LULU) — FY2026-Q2