Nvidia’s (NVDA) meteoric rise over the past two years has been fueled by unprecedented demand for its artificial intelligence (AI) chips, and with that surge has come something else: an avalanche of cash. The chipmaker is now sitting on a financial war chest that would have been unimaginable just a few years ago. And as that pile of cash continues to swell, one debate on Wall Street is getting louder: Does Nvidia now have too much cash?
That question gained new momentum following the company’s latest string of deals, including a $2 billion investment in chip design firm Synopsys (SNPS) last week. With tens of billions in cash and more pouring in each quarter, investors are wondering what comes next. Should Nvidia double down on strategic investments? Ramp up stock buybacks? Or boost its tiny dividend?
