Since **NVIDIA** has generated record profits over the last handful of quarters, I decided to look into what they´ve been up to in regards to how they´ve been spending that cash. Here´s a **breakdown**...
(AI wasn´t used to draft this)
In **FY'26** (ending Jan'26):
They generated around **$96,3 billion** in cash from operations.
**$40 billion** worth of shares were repurchased.
**$17,5 billion** were used for **private** equity investments.
**$17,4 billion** went into **public** equity investments.
**$13 billion** went to **Groq, Inc.** separately.
**$6 billion** in **capex**, **$1,5 billion** for **acquisitions** and about **$1 billion** paid in **dividends**.
Adds up to about **$96,3 billion**.
In the first **six months** of **FY'27** (ending Jan'27):
They generated **$70,4 billion** in cash from operations
**$42,4 billion** went to **equity** securities (private & public).
**$39 billion** worth of **buybacks**.
**$6,3 billion** in **dividends**.
**$4,4 billion** for **capex**.
**$2,9 billion** to **Groq, Inc.**
Adds up to exactly **$95 billion**, with difference covered by a **$25 billion** **bond** sale.
Meaning over the last **six quarters**, they´ve generated **$166,7 billion** in **cash** and they´ve spent **$191,3 billion** with **$25 billion** in issued **debt**.
So to sum up their **spending**:
49,5% went to **other companies** mostly through equity investments (1,6% actual acquisitions)
45,1% went to **shareholders** through dividends and buybacks.
5,4% went to capex.
(With another $13 billion acquisition of hugging face, so another company, announced right after).
I´m specifically not outlining the guarantees, commitments and other liabilities NVIDIA has signed up for, for third-parties, but simply looking at what they´re taking in and what they´re using it for. Not listening to speeches or interviews of executives, but letting the numbers speak and to me they don´t make much sense.
If you didn´t tell me the company attached to these numbers, I´d say that´s the cashflow statement of a large venture capital firm. Pay out half to keep investors happy and the other half for new private and public ventures. This shouldn´t be the cashflow statement of a hardware/datacenter development/manufacturing company, especially not one that constantly complains about being supply constraint, but only takes 5% of operating cashflow for capex.
I know that NVIDIA outsources its manufacturing to TSMC and buys HBM from Micron & SK hynix. But if you´re making bank selling your hardware at >60% net margins, why the fuck would you not help build more capacity, but instead risk it on buying parts of unprofitable, risky companies like a VC. VCs need to take on risk, in order to earn returns, however NVIDIA just needs to make more of what they´re already selling, with little risk attached at >60 net margins. And the argument, that they´re not spending more to keep prices artificially high doesn´t hold up either, since more than 2/3rds of their recent growth came from volume (when looking at TSMC output), unlike memory manufacturers where close to 90% of growth can be attributed to price movement.
A company that´s making bank selling hardware and is supply constrained shouldn´t operate like this from a rational perspective.
A company that has to invest in others or provide financing to others in order to create demand, now that´s more like it.
What´s your take on NVIDIAs cash allocation? What do you make of it?