Nvidia Corp. on Monday announced a $150 billion expansion to its existing share repurchase program, bringing the total authorization to $235 billion—the largest such increase in market history. The company expects to complete the buyback by the end of its fiscal year 2028, citing strong cash generation from demand for AI-related chips.
Shares of the Santa Clara, California-based company rose 1.2% to 1.7% in premarket trading following the announcement. Nvidia’s stock has gained more than 20% this year, closing Friday at a valuation of $5.42 trillion. The company’s forward earnings multiple of 16.5 times is the lowest since January 2015, according to LSEG data.
CEO Jensen Huang framed the move as a reflection of confidence in long-term growth, stating in a release: “Our cash generation gives us the capacity to invest in the technologies that advance this transformation and return capital to shareholders.” He reiterated this sentiment in a CNBC interview, calling the current period “the largest infrastructure buildout in human history.”
Immediate Action & Core Facts
Nvidia’s $150 billion buyback authorization surpasses Apple’s $110 billion record set earlier this year, marking the largest single increase in a stock repurchase program. The expansion lifts the company’s total remaining buyback capacity to $235 billion, with execution planned through fiscal 2028. The announcement follows a roughly 50% slowdown in buybacks industry-wide from July through September 23.
The company’s cash reserves stood at $22.44 billion at the end of its July quarter, providing financial backing for the program. Nvidia also projected 70% revenue growth for fiscal 2028, addressing investor concerns about the sustainability of AI spending after years of explosive expansion.
Deeper Dive & Context
AI Demand Fuels Buyback Expansion
Nvidia’s growth is directly tied to the AI infrastructure boom, with hyperscalers projected to spend over $1.3 trillion by 2027 on data centers and related technologies, according to S&P Global Ratings. The company’s chips—including Grace Blackwell, Vera Rubin, and Jetson systems—are central to this buildout, powering AI training, inference, and accelerated computing.
Huang stated that Nvidia expects to double chip sales by 2027, underscoring the scale of demand. The company’s portfolio extends beyond AI chips to include CPUs, networking chips, and gaming components, such as those used in Nintendo’s Switch 2 console.
Market Reactions and Valuation Signals
Despite the buyback announcement, Nvidia’s forward earnings multiple of 16.5x—below its 15-year average of 30x—has raised questions among analysts about whether profit growth expectations are moderating. Some suggest the valuation reflects skepticism about the longevity of AI spending, even as the company forecasts continued revenue expansion.
The stock’s 24% gain over the past 12 months has contributed to its status as the world’s most valuable company, though the buyback authorization signals a strategic shift toward returning capital to shareholders rather than reinvesting all profits.
Investor Scrutiny and Strategic Investments
Nvidia’s investments in AI startups and cloud providers have drawn scrutiny from some investors, who question whether such funding indirectly sustains demand for its own chips. The company has not disclosed specific allocations for these investments but maintains that its cash generation supports both technological advancement and shareholder returns.
Long-Term Implications
The buyback expansion underscores Nvidia’s confidence in the durability of the AI cycle, even as questions persist about potential slowdowns in enterprise spending. The company’s ability to generate $22.44 billion in cash provides a financial cushion, but the scale of the repurchase program—$235 billion over four years—raises questions about liquidity management and future investment priorities.
Analysts will closely monitor Nvidia’s revenue growth trajectory and cash flow generation in the coming quarters to assess whether the buyback aligns with long-term value creation or prioritizes short-term returns.