SANTA CLARA, California, August 31, 2026, 18:56 EDT – Nvidia shares climbed 1.5% after the chipmaker’s $20 billion buyback plan, equal to 0.4% of its market capitalization.
- Nvidia NASDAQ:NVDA finished at $220.78, gaining 1.48%, with 124.0 million shares traded.
- Revenue for the quarter increased by 106% to $96.22 billion, with Data Center climbing 117%.
- The $20 billion buyback represents 0.38% of Nvidia’s $5.33 trillion market capitalization.
- Revenue for the third quarter is projected at $108 billion, with an expected gross margin of 74%.
NVIDIA Corporation NASDAQ:NVDA gained 1.48% to end Monday at $220.78. The company’s $20 billion quarterly buyback represents just 0.38% of its market capitalization.
This discrepancy alters what the buyback signals to investors. With earnings growth now responsible for nearly all the valuation at $5.33 trillion, its impact is magnified.
The stock is still trading 3.2% under Thursday’s post-earnings closing price of $227.98. Monday’s rebound recouped under a third of Friday’s $10.43 decline.
Nvidia’s earnings-week round trip
Regular-session closes, U.S. dollars
As of . Sources: Investing.com history and Schwab close.
The base quarter delivered strong results. Revenue climbed 106% to $96.22 billion. Net income increased 126%, totalling $59.69 billion.
Data Center contributed $89.0 billion, accounting for 92.5% of total revenue. Revenue in this segment increased 117% compared to the previous year. GAAP gross margin rose by 2.6 percentage points to reach 75.0%.
Nvidia handed back $26 billion to shareholders, Chief Financial Officer Colette Kress said. The company spent $20 billion on share repurchases and $6 billion on dividends, totaling 60% of free cash flow for the first half.
Large cash return, small valuation offset
Fiscal second quarter cash returned versus August 31 equity value
At Monday’s $220.78 close, $20 billion could buy about 90.6 million shares—roughly 0.38% of 24.1 billion outstanding.
Company figures for the quarter ended July 26, 2026; market value as of August 31. Sources: Nvidia, Schwab and StockAnalysis. Percentages are calculated.
The math has less impact at current scale. Based on Monday’s close, the buyback would remove approximately 90.6 million shares, which represents about 0.38% of the 24.1 billion total shares outstanding.
As of July 26, management retained $99 billion in remaining repurchase authorization. That amount represents only 1.86% of the company’s market capitalization on Monday.
The main backing comes from the operating outlook. Nvidia projected third-quarter revenue at $108 billion, with a margin of error of 2%. The midpoint points to sequential growth of 12.2%.
Margins remain under pressure. Management forecasts a 74% margin in the third quarter, declining to between 71% and 72% in the fourth. Kress cited significant memory pricing as the reason.
Wall Street analysts remain heavily tilted in their outlook. According to MarketBeat, there are 52 Buy or Strong Buy recommendations, three Hold ratings, and zero Sell calls. The average price target stands at $324.23, suggesting a 46.9% potential gain compared with the most recent price.
Analysts remain overwhelmingly positive
Most recent rating from 55 Wall Street analysts
Ratings and target as of August 31, 2026. Source: MarketBeat analyst forecast. Target upside is a forecast, not a realized return.
Chief Executive Jensen Huang said, “AI has reached its inflection point.” The supply situation continues to be tight. Management anticipates these constraints persisting through fiscal 2028, even as early guidance points to 70% revenue growth. Nvidia statement
Risks: Nvidia has removed China Data Center compute revenue from its present outlook. Days sales outstanding climbed to 60, a result of customer payment terms. Cash conversion may be reduced by memory expenses, partner guarantees, and limitations in power supply.
The next official shareholder record date is September 10 for the quarterly dividend. Payment is scheduled for October 1. The main challenge continues to be achieving $108 billion without a further decline in margins.
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