Will NVIDIA Stock Split?

NVIDIA has split its stock six times during its 25 years as a public company. The first stock split happened in 2001, and it doubled the number of shares available. If you owned 100 Nvidia shares before the split, you had 200 shares after. The most recent stock split occurred on May 22, 2024 and was 10:1 meaning for every 100 shares owned on May 21, 1,000 were owned the next day.

Companies typically split stocks to lower the price of individual shares, making them more affordable for investors. Theoretically, a share worth $1,000 will be worth $100 after a 10:1 split. Instead of owning one share worth $1,000, you own 10 shares worth $1,000 in total.

Not surprisingly, stock splits rarely follow that ideal scenario. Historically, Nvidia shares have lost value — 23% on average —after stock splits. Using that average, a share worth $1,000 before the split would become 10 shares worth a total of $770 after the split. Even two years after a stock split, Nvidia shares have been down 3% on average.

Given that Nvidia is one of today’s most profitable companies, investors who held their shares obviously made money after each stock split. It just took them more than two years to enjoy those financial rewards. Last quarter, Nvidia reported record quarterly revenue of $35.0 billion, up 93.6% from a year ago, and a record full-year revenue too.

With such astronomical top and bottom line figures, will Nvidia stock split again in the near future? 

NVIDIA Bottom Line Eclipsing Top Line

The most recent stock split was triggered when NVIDIA hit ballpark $1,200 per share and resulted in the Board deciding to enact a 10-for-1 share split. Such massive share count issuance hinted at management’s confidence that the company was going through an S-curve type scaling moment. Interestingly, NVIDIA share price bucked the trend this time around and, as opposed to underperforming post stock split, it rose by about 25% thereafter. 

To put things in perspective, NVIDIA didn’t just grow on a YoY basis by almost 2x last quarter, but it did so off a massive number of $18.1 billion a year ago, and that has resulted in net income soaring from $9.2 billion to $19.3 billion within 12 months. To further clarify, NVIDIA last quarter generated more profits than it did revenues in any quarter in its history except over the past year.

If NVIDIA Stock Splits Again, What Happens Next?

As unlikely as a Nvidia stock split is for 2025, plenty of people believe it could happen. What would that stock split look like?

While it’s impossible to predict the specifics of an upcoming Nvidia stock split, there are some reasonable features investors can expect. For instance, the company would almost certainly take a less aggressive approach than it did in 2024. Instead of a 10:1 split, we’d probably see a 2:1 or 3:1 split.

The reality is a split is highly improbable, not least because investors might view another dilution as being unnecessary and financial engineering as opposed to being justified. With that said, the pace of revenue and earnings growth is such that NVIDIA has an enormously strongly fundamental tailwind that is supporting massive share price gains.

While those pristine financials remain in place, the market seems happy to apply a huge multiple to the firm’s earnings. The current price-to-earnings multiple is 55x, which is not actually massive when you factor in growth of 50% annually that is forecast over the next five years. 

Is It Likely NVIDIA Will Split Soon?

The May 22 stock split made a lot of sense because NVIDIA shares were trading around $1,200, which is much more expensive than shares of other high-profit companies. Amazon shares hoven around $200; Apple shares trade for about $230. Even META’s relatively high price (currently above $600) doesn’t come close to the pre-split price of Nvidia shares.

Looking at these other company stock prices and Nvidia’s history, it seems unlikely that the company will split shares again in the near future. The 2024 split gave shares a more competitive price, so Nvidia achieved its goal.

The good news for investors is that NVIDIA shares didn’t lose value after the May split. However, the increased value isn’t high enough that the company would need another split. That would only likely happen if Nvidia shares had skyrocketed over at least $500.

Even if Nvidia decides to split its stock within the next year or two, it probably wouldn’t take the aggressive strategy it used in 2024. Letting the price reach $1,200 could have been a misjudgment on leadership’s behalf, which could help explain why the company took a 10:1 split. A more reasonable approach for 2025 or 2026 would likely double or triple the number of available stocks. Let’s say share prices reach $400 next year. In that scenario, it’s not impossible to imagine Nvidia using a 2:1 split to bring share prices closer to $200.

While it seems very unlikely that Nvidia will split stocks again in the near future, anything’s possible. Investors who currently hold Nvidia shares might want to retain the ones they have or purchase a small number of additional shares. Selling the stock right now seems unwise since Nvidia enjoys such high revenues and profits. Plus, the company’s role in AI technology could make it an increasingly profitable opportunity for investors. Then again, the tariffs President-Elect Trump says he will implement could disrupt Nvidia’s business plan since it relies on fabrication facilities in Taiwan.

For now, analysts are still betting on more upside with a $177 per share consensus price target and it seems well-deserved given the perfect Piotroski Score of 9 the company enjoys now. One cautionary note for those who missed the move is that a discounted cash flow forecast suggests there is higher risk than analysts expect and predicts a correction down to $123 per share.

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The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.