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Nvidia Adds $150 Billion to Stock Buyback Authorization, Surpassing Apple for Record Increase

Source Tradingkey

TradingKey - Nvidia (NVDA) announced Monday that its board of directors has approved an additional $150 billion share repurchase authorization on top of its existing stock buyback program, bringing the company's remaining share buyback capacity to $235 billion. This is the largest increase in share repurchase authorization in Nvidia's history, and the company expects to utilize this capacity before the end of fiscal year 2028. Following the announcement, Nvidia shares rose nearly 2% in Monday pre-market trading.

nvda-bbd27aebe31045bc98c7b1ebfab401d3

Source: FUTUBULL

The $150 billion increase surpasses Apple's (AAPL) $110 billion buyback authorization increase approved in 2024, making it the largest single stock repurchase authorization expansion by a U.S. company to date. It should be noted that a buyback authorization does not mean Nvidia will immediately purchase all the stock at once; the company will still determine the actual pace of buybacks based on share price, cash needs, and investment plans.

Nvidia CEO Jensen Huang stated that strong cash generation driven by AI and accelerated computing enables the company to return capital to shareholders while continuing to invest in new technologies. The company's second-quarter revenue reached $96.2 billion, up 106% year-over-year, with the data center business remaining the primary growth driver.

The expanded buyback also comes after a notable pullback in Nvidia's valuation. LSEG data shows that Nvidia is currently trading at approximately 16.5 times its next 12-month earnings, the lowest level since January 2015 and significantly below its 15-year average of around 30 times. Some analysts believe this reflects a degree of market skepticism regarding the sustainability of rapid AI growth.

At the same time, Nvidia continues to expand investments in AI chips, cloud computing, and AI infrastructure. The company previously projected revenue growth of approximately 70% in fiscal 2028, and this record buyback plan demonstrates that while scaling up AI investments, Nvidia is also utilizing its rapidly growing cash flow to further boost shareholder returns, underscoring management's confidence in the company.

Source

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