Return-ratio valve:
Policy floor
Delivered pace
Implied step-up
Nvidia free cash flow to capital-return re-rate mechanism
Supply-gated growth and the reset gross margin fill a free cash flow pool; a return-ratio valve splits returned versus retained cash across three payout regimes, and higher payouts shrink the share count, let per-share EPS outrun operating earnings, and fire the Apple-precedent multiple re-rate.
binding inputs: supply + margin,
not demand
growth guide
supply-gated
gross margin
reset & realized
operating
income
free cash flow
free cash flow pool · half of revenue
buybacks · dividends
return
payout policy
retained
stays in business
shares shrink
per-share EPS grows
faster than operating
Apple-style
re-rate
P/E
growth-funded FCF
›
buyback scale
›
EPS / share shrink
›
Apple re-rate