Nvidia (NVDA) Stock Gains After Record $150 Billion Buyback News
TLDR
- Nvidia’s board approved a $150 billion increase to its buyback program, bringing total authorization to $235 billion.
- The new program is the largest stock buyback in U.S. history, topping Apple’s $110 billion plan from 2024.
- Nvidia expects to complete the remaining repurchases through fiscal year 2028, which ends in January of that year.
- CEO Jensen Huang tied the buyback to the company’s cash generation from the AI computing boom.
- Shares rose about 1% in premarket trading, and competitors AMD and Intel also ticked higher.
Nvidia stock rose Monday after the company announced the largest stock buyback in U.S. history. Shares were up 1.2% in premarket trading, reversing earlier losses. Nvidia now carries a market capitalization of $5.42 trillion.
The chip maker’s board approved a $150 billion increase to its share-repurchase program. That brings Nvidia’s total buyback authorization to $235 billion.
Nvidia said it expects to carry out the remaining repurchases through its fiscal year 2028, which wraps up in January of that year. The company did not lay out a specific pace for the buybacks.
CEO Jensen Huang explained the thinking behind the move in a statement Monday morning. “Nvidia’s growth is being driven by a once-in-a-generation platform shift to AI and accelerated computing,” he said.
Huang added that the company’s cash position gives it room to do both. “Our cash generation gives us the capacity to invest in the technologies that advance this transformation and return capital to shareholders,” he said.
A Buyback Bigger Than Apple’s
The previous record for a U.S. corporate buyback belonged to Apple. That company announced a $110 billion program back in 2024.
Nvidia’s new $235 billion authorization clears that mark by a wide margin. Bloomberg data confirms it as the largest buyback program ever launched by a U.S. company.
Nvidia has been following a similar playbook to Apple in recent years. Both companies have leaned on buybacks to boost shareholder returns as cash piles up.
Free Cash Flow Backs the Plan
Nvidia has committed to returning 50% of its free cash flow to shareholders. That return comes through a mix of dividends and buybacks.
FactSet estimates put Nvidia’s free cash flow at $183 billion for this year. That figure gives some sense of scale behind the new buyback math.
The company’s cash generation has climbed alongside demand for its AI chips. Data centers and accelerated computing have been the main drivers of that demand.
Huang’s statement framed the buyback as a sign of confidence rather than a one-off move. “This authorization reflects our confidence in the long-term opportunity ahead,” he said.
Nvidia stock has climbed 21% so far this year heading into Monday’s session. The buyback news added to that gain in early trading.
Reaction spread beyond Nvidia itself on Monday morning. Shares of chip rivals AMD and Intel also ticked up following the announcement.
Neither AMD nor Intel commented on the Nvidia news specifically. Both stocks moved in step with the broader chip sector reaction.
Nvidia’s buyback authorization does not expire until fiscal 2028. That gives the company more than a year to work through the full amount.
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