Nvidia's board approved a $150 billion increase to the company's stock buyback program on September 28, which the company and multiple market reports describe as the largest single share-repurchase authorization any company has announced. The new authorization brings Nvidia's total remaining buyback capacity to $235 billion, which the company expects to have available through its 2028 fiscal year.
Why Nvidia is doing this
A stock buyback is when a company uses its own cash to purchase shares on the open market, reducing the number of shares outstanding. Companies typically do this when they believe the stock is undervalued, want to return excess cash to shareholders, or want to offset dilution from employee stock compensation. Nvidia's cash position has swelled over the past two years as demand for its AI chips has driven record revenue and profit.
NVIDIA's growth is being driven by a once-in-a-generation platform shift to AI and accelerated computing. Our cash generation gives us the capacity to invest in the technologies that advance this transformation and return capital to shareholders.
