TLDR
- Nvidia shares rose about 3% Friday, hitting a fresh intraday record above the May high.
- The company is pushing back on claims from skeptics like Michael Burry that AI chip depreciation schedules are too generous.
- Nvidia points out Meta and Google have extended server depreciation schedules from four years to six.
- The board authorized an extra $150 billion in buybacks, bringing the total to $235 billion through fiscal 2028.
- Morgan Stanley reinstated Nvidia as its top semiconductor pick after meeting with CEO Jensen Huang.
Nvidia (NVDA) stock climbed roughly 3% on Friday, touching a fresh intraday record and pulling ahead of its previous all-time closing high from May. Shares were trading near $237.75 in the session, extending a rally that has pushed the stock up about 27% this year.
The move came from two directions at once. One is a brewing argument over how long AI chips actually last. The other is cold, hard cash heading back to shareholders.
Start with the depreciation debate. Investor Michael Burry, known for calling the 2008 housing crash, has argued that Big Tech companies are underestimating how fast their AI chips wear out. If true, that would mean today’s profits are propped up by accounting that flatters the numbers.
Nvidia is not staying quiet on this one. The company is highlighting that major customers like Meta Platforms and Google have stretched their AI server depreciation schedules from four years out to six. That’s a direct rebuttal aimed at the heart of the skeptics’ case.
Why the Buyback Matters
The second driver is more straightforward. Nvidia’s board authorized an additional $150 billion in share repurchases this week. That brings the company’s total remaining buyback authorization to $235 billion through fiscal 2028.
It’s the largest buyback authorization in corporate history. That’s not a small flex. It signals Nvidia’s management believes the company can keep generating serious cash even while pouring money into AI infrastructure.
Wall Street took notice. Morgan Stanley reinstated Nvidia as its top semiconductor pick on Friday, following meetings with CEO Jensen Huang and other executives. The firm pointed to continued strength in AI demand and a growing customer base.
Morgan Stanley also flagged something worth watching. The firm argued the AI infrastructure bottleneck is shifting away from chip production and toward data center land, power supply and financing.
That’s a meaningful shift in the conversation. If chips are no longer the scarce resource, the companies holding onto cheap power and prime real estate get a bigger edge.
The Bigger AI Picture
Nvidia isn’t operating in a vacuum here. The broader AI trade has investors looking past pure infrastructure spending and toward what comes next in the technology cycle.
Anthropic’s expected IPO is adding fuel to that fire. A public listing for the Claude developer would be another high-profile test of how much appetite investors still have for AI companies and the capital they need to scale up.
For Nvidia specifically, the combination of record buybacks and a public counterargument to its critics gives the stock a fresh story heading into October. The company is no longer just letting the depreciation debate play out in the background.
Nvidia also works closely with Wall Street firms to help deploy roughly $500 billion in capital supporting the AI sector, a figure that underscores just how large the stakes have become in this debate over chip lifespans and spending.
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