NVIDIA Announces an Additional $150 Billion Stock Repurchase Plan, Setting a New Record for Largest Repurchase in U.S. Corporate History, Surpassing Apple's Previous Record of $110 Billion. CEO Jensen Huang stated that this move demonstrates the company's confidence in the long-term opportunities of AI. Boosted by this news, NVIDIA's stock price rose by 1.3% before trading on Monday, after previously falling by nearly 1%.
As it continues to reap huge profits from its top position in the AI supply chain, NVIDIA announced a new stock repurchase plan worth an additional $150 billion, setting a new record for the largest repurchase in the history of American corporations.
The world's most valuable company by market capitalization stated on Monday that its board of directors has approved an increase of $150 billion to its share repurchase plan. Together with the existing plans, NVIDIA is now authorized to spend up to $235 billion on share repurchases before January 2028. Boosted by this news, NVIDIA's stock price initially rose by more than 3%.
NVIDIA co-founder and CEO Jensen Huang stated in a statement on Monday that this new initiative reflects the company's "confidence in the long-term future opportunities" in the AI field. He emphasized that the platform transformation driven by AI and accelerated computing has led to business growth, and the company's strong cash flow generation capability enables it to return capital to shareholders while investing in advancing technological transformation.
At the time of this massive repurchase initiative, there were signs that NVIDIA's stock price momentum was beginning to slow down. As more and more investors began to question the sustainability of the AI craze, this record-breaking capital return not only directly addressed market concerns but also highlighted the management's high confidence in the monetization capabilities of its core business.
Setting a new record for capital returns for American companies
NVIDIA's authorization of $150 billion this time breaks the previous record set by Apple in 2024 with a $110 billion buyback, which was the largest buyback by a U.S. company at that time. According to Bloomberg, when Apple announced this buyback, this iPhone manufacturer topped the list of the top five largest buyback authorizations by U.S. companies.
Normally, large-scale share repurchases indicate that the company's management believes its stock is undervalued, but this is often also related to the slowdown in growth faced by large, mature enterprises. For example, when Apple set a record for share repurchases, the growth of its iPhone business was slowing down, and it relied mainly on its dominant position in the smartphone market to generate profits.
However, NVIDIA's trajectory stands in sharp contrast to this. The sales of this chip manufacturer are still rising rapidly, and it is expected that its revenue this year will increase by about 90%. This indicates that while NVIDIA is implementing substantial shareholder returns, its fundamentals are still in a phase of rapid expansion.
AI Strong demand for infrastructure investment persists
The sharp increase in NVIDIA's profits is fundamentally due to the fact that the entire tech industry is still pouring massive amounts of capital into AI infrastructure. According to Goldman Sachs' predictions, this year's global investment in the AI sector will exceed one trillion dollars.
As the core computing power that supports the operation of large language models such as ChatGPT, Claude, and Gemini, NVIDIA's chip products are still in high demand in the market. In the fierce AI competition, many companies, including OpenAI, Anthropic, and SpaceX, are its major customers. Even Google, which has independently developed its own AI chip series, is an important buyer of NVIDIA products in its cloud computing department.
Ample cash flow supports long-term valuation
Outstanding financial results provided strong support for NVIDIA's substantial share repurchases. According to the consistent forecast data from Visible Alpha under S&P Global, in the most recent fiscal year ending January of this year, NVIDIA generated nearly $100 billion in free cash flow. It is expected that by the 2028 fiscal year, this figure will more than triple to reach $329 billion.
In terms of net profit, according to the prediction of Visible Alpha, NVIDIA's net profit for this fiscal year is expected to double to $245 billion, and it is further projected to rise to $387 billion in the next fiscal year ending January 2028.
In terms of performance in the secondary market, since OpenAI launched ChatGPT at the end of 2022, NVIDIA's stock price has increased by more than 1200% cumulatively. However, in 2026, the remarkable upward trend of the stock has slowed down, with an increase of about 20% so far this year. Against the backdrop of market disagreements regarding the sustainability of the prosperity of AI, strong profit expectations and ample cash flow have become the core supports for stabilizing investors' confidence in NVIDIA.
Edit / lambor
