Nvidia boosts share buyback by record $150 billion as AI boom fuels growth
· CNA · JoinRead a summary of this article on FAST.
Get bite-sized news via a new
cards interface. Give it a try.
Click here to return to FAST Tap here to return to FAST
FAST
Sept 28 : Nvidia boosted its share buyback authorization by a record $150 billion, eclipsing Apple's $110 billion approval in 2024, as the chip giant's stock trades near its lowest earnings multiple in more than a decade.
Shares of Santa Clara, California-based Nvidia rose nearly 2 per cent. The stock has gained more than 20 per cent this year through Friday's close.
The additional authorization lifts Nvidia's remaining buyback capacity to $235 billion, which it expects to use through fiscal 2028, as surging demand for AI training and inference fuels cash generation.
Nvidia shares were trading at about 16.5 times 12-month forward earnings, their lowest multiple since January 2015 and well below the 15-year average of 30, according to LSEG data, which some analysts see as a sign of slowing profit-growth expectations.
CNA Games
Guess Word
Crack the word, one row at a time
Buzzword
Create words using the given letters
Mini Sudoku
Tiny puzzle, mighty brain teaser
Mini Crossword
Small grid, big challenge
Word Search
Spot as many words as you can
Show More
Show Less
The announcement comes amid a slowdown in stock buybacks, which fell about 50 per cent from July through September 23.
"Our cash generation gives us the capacity to invest in the technologies that advance this transformation and return capital to shareholders," CEO Jensen Huang said in a statement.
Nvidia's $150 billion buyback increase exceeds the market capitalization of about 84 per cent of the S&P 500 constituents, according to data compiled by LSEG.
"The AI buildout won't continue at its current pace forever, but Nvidia is signaling confidence that demand for its hardware and services has staying power," said Jacob Bourne, an analyst at Emarketer.
"Its cash generation is currently strong enough that it believes it can continue investing heavily in the business while also returning capital to shareholders," he added.
Nvidia ended the July quarter with $22.44 billion in cash and cash equivalents. It last announced an $80 billion share buyback in May.
Last month, it forecast about 70 per cent revenue growth for fiscal 2028, reassuring investors who have questioned how long the AI spending surge can last after years of explosive growth.
Newsletter
Week in Review
Subscribe to our Chief Editor’s Week in Review
Our chief editor shares analysis and picks of the week's biggest news every Saturday.
Sign up for our newsletters
Get our pick of top stories and thought-provoking articles in your inbox
Get the CNA app
Stay updated with notifications for breaking news and our best stories
Get WhatsApp alerts
Join our channel for the top reads for the day on your preferred chat app