Nvidia is seeking to raise at least $20 billion through a bond sale, as disclosed in a recent SEC filing. This move comes amid the company's substantial growth driven by the AI sector, particularly following the launch of OpenAI's ChatGPT, which has led to increased demand for its graphics processing units. Nvidia's shares rose 3.5% on Monday and have increased approximately 14% this year.
The company previously indicated it could raise up to $25 billion through unsecured commercial paper notes. Currently, Nvidia holds about $7.5 billion in long-term debt and $1 billion in short-term debt. The proceeds from this debt offering are intended for general corporate purposes, including the repayment and refinancing of existing obligations.
Nvidia's aggressive capital return program, announced in May, includes a dividend increase and plans to repurchase $80 billion in shares. The company generated $49 billion in free cash flow in the latest quarter, up from $35 billion a year earlier, and aims to return roughly 50% of free cash flow to shareholders this year.
This bond sale positions Nvidia to further capitalize on its growth trajectory in the AI market