Nvidia Authorizes Additional $150 Billion Buyback, Raising Remaining Program to $235 Billion

Shares rose almost 3% Monday, bringing their year-to-date gain to roughly 24%. CNBC’s Jim Cramer said Monday that the buyback is ‘very significant’ and that if Nvidia is active in the market every day, it will ‘change the trajectory of the stock.’

The move comes as Nvidia’s stock has lagged despite its central role in the AI boom. Adjusted earnings per share have more than doubled in back-to-back quarters. For fiscal 2027, Nvidia is projected to grow earnings by 94%, according to FactSet estimates, an acceleration from 60% growth in the prior year. Yet Nvidia this year is the seventh-worst performer in the iShares Semiconductor ETF, which contains 30 stocks. The ETF as a whole is up 86%, including Monday’s intraday move.

Cramer has pushed Nvidia to put more of its growing cash stockpile toward repurchases. Buybacks reduce shares outstanding, increasing remaining shareholders’ ownership stakes and, all else equal, boosting earnings per share. Earlier this month, Cramer called for Nvidia to authorize as much as $500 billion in buybacks, pointing to Apple’s longtime strategy of aggressive and consistent repurchases. In May, he explicitly urged Nvidia to take a page from Apple’s buyback playbook. He said Monday during ‘Morning Meeting’ that former Apple CFO Luca Maestri ‘would buy every day,’ adding that Maestri would double or triple purchases on dips. Apple bought back more than $800 billion of stock during Tim Cook’s 15 years as CEO, according to FactSet, reducing its share count by roughly 40%. If Nvidia follows the same active strategy, Cramer said, ‘then you’re going to see this stock advance dramatically.’

Nvidia was already stepping up buybacks. In May, the board authorized an additional $80 billion in repurchases with no expiration date. The company bought back a combined $39 billion of stock during the first two quarters of fiscal 2027, according to FactSet, nearly matching its repurchases for all of fiscal 2026. Nvidia bought back roughly $34 billion in fiscal 2025. Nvidia has committed to return at least 50% of free cash flow to shareholders through buybacks and dividends. In May, it raised its quarterly dividend payout to 25 cents a share from a penny. At less than a 0.5% dividend yield, Nvidia is far from an income-oriented stock, but the decision reflects confidence in sustaining the higher payout.

Nvidia has also used its financial strength to support the broader AI ecosystem through investments in and financing arrangements with customers and other companies building AI infrastructure. Those deals have fueled concerns about so-called circular financing, in which companies help fund customers that ultimately spend money on their products. CNBC said that while it is mindful of the risks associated with Nvidia’s use of its balance sheet, that is not a reason for it to leave the stock. With fervent demand for AI computing power, Nvidia’s AI chips can be redeployed if a particular supported customer runs into trouble, and the company has enough firepower to ramp up buybacks without sacrificing investments needed to maintain its AI leadership.

Wall Street projects Nvidia to generate roughly $440 billion in free cash flow over its next six unreported quarters, according to FactSet. That is the period in which Nvidia said it expects to complete the $235 billion buyback. Nvidia CEO Jensen Huang said Monday on CNBC’s ‘Squawk Box’: ‘We’re going to generate a lot of cash in the coming years, and every single year, as we generate more cash, we’d like to be able to return it back to shareholders.’ CNBC said the buyback strengthens the case for owning Nvidia. While the additional $150 billion authorization falls short of the $500 billion Cramer called for, it is a major step in the right direction, and the business continues to benefit from enormous AI infrastructure spending.