Nvidia’s big dividend hike could pave the way for higher payouts — who may be next

Nvidia's massive dividend boost could lay the groundwork for other big tech companies to follow suit. The chipmaker has seen "parabolic" demand for its artificial intelligence chips in data centers and recently said it will expand into chips for personal computers — which will " reinvent the PC ," according to CEO Jensen Huang. That demand has been a cash-flow windfall for the company, which recently said it would return even more money to shareholders. It declared a 2,400% dividend increase — from a 1 cent per share quarterly dividend to 25 cents a share — as well as an $80 billion share buyback program. The dividend will be paid on June 26 to shareholders on record as of Thursday. After the surprise dividend increase, dividend futures moved up at least two to three points across the curve, "reflecting the expected addition to the bottom-up consensus estimates for 2027 onwards," UBS strategist Maxwell Grinacoff said in a note Monday. "We think this could potentially open the door for other top-weighted SPX corporates with healthy FCF [free-cash-flow] yields to start paying or increasing dividends as part of their shareholder return programs," he added. NVDA YTD mountain Nvidia one year performance The tech sector is now the largest dividend payer in the S & P 500 for the first time ever, Grinacoff noted. He expects the most dividend growth over the next five years to come from tech, primarily from Nvidia and Amazon . The latter does not even pay a dividend yet. …