Nvidia announces 10-for-1 stock split after AI-driven boom in share price

Nvidia reported a 10-for-1 forward stock split in its fiscal first quarter results announcement on Wednesday. According to the announcement, the shares will resume trading on a split-adjusted basis at the market’s opening on June 10.

Stock splits do not impact a company’s financial fundamentals, but they do make each share cheaper, which can have a beneficial psychological effect on individual investors. The equity split will make ownership “more accessible to employees and investors,” according to Nvidia.

Nvidia stock finished Wednesday at $949.50. With a 10-for-1 split at that pricing, each share would cost $94.95, but an investor would need to acquire 10 of them to possess the same amount of the company as they do now with one share. Alphabet, Amazon, and Tesla all planned stock splits in 2022.

Nvidia shares rose nearly 4% in extended trading on Wednesday.

The business announced that each holder of Nvidia’s common stock will receive nine more shares of common stock after the market closes on Friday, June 7. Trading will begin the following Monday.

Nvidia investors have enjoyed a historic surge over the last five years, with the stock price increasing by 25 times. The company was long renowned as the leading manufacturer of sophisticated graphics processing units (GPUs) for video games, but it has recently emerged as a key hardware participant in the artificial intelligence boom.

Nvidia’s revenue increased by 262% in the fiscal first quarter compared to the previous year, marking the third consecutive quarter of growth of more than 200%.

The chipmaker also announced an increase in its quarterly cash dividend from 4 cents to 10 cents per share on a pre-split basis. Following the split, the dividend will be a cent per share.