Nvidia to Split Stock 10-for-1 After Big Gains from AI Boom

In its earnings report for the first quarter of fiscal year 2019, Nvidia called for a 10-for-1 forward stock split. A news release says that the shares will start trading on June 10 at the start of the market, taking into account the split.

When a company splits its shares, it doesn’t change how much money it makes, but each share becomes cheaper, which can make small investors feel better. In a press release, Nvidia said that the stock split would make ownership “more possible for employees and investors.”

Impact of Stock Split on Investors

The last price of Nvidia stock was $949.50 on Wednesday. At that price, a 10-for-1 split would make each share $94.95, but an investor would have to buy 10 of them to own the same amount of the business as they do now with one share. In 2022, Alphabet, Amazon, and Tesla all split their shares. During late trading on Wednesday, Nvidia stock rose almost 4%. The company said that people who own Nvidia common stock will each get nine more shares of common stock after the market closes on Friday, June 7. The next Monday will be the first day of trading.

The stock price of Nvidia has gone up 25 times in the last five years, giving investors a historic rally. For a long time, the company was known for making the best graphics processing units (GPUs) for video games. But recently, it has become the biggest name in hardware for the AI boom.

In Nvidia’s fiscal first quarter, sales jumped 262% compared to the same time last year. This is the third quarter in a row that sales have grown by more than 200%. Also, the chipmaker said it would raise its quarterly cash dividend from 4 cents per share to 10 cents per share before the split. A penny will be paid out for every share after the split.

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Louis Clarke

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