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NVIDIA’s Jensen Huang Earns Long-Overdue Pay Raise Amid AI Revolution Surge

Marcus LeeFriday, May 2, 2025 2:35 pm ET

39min read

NVDA --

NVIDIA CEO Jensen Huang’s first base salary increase in over a decade—marking a 49% jump to $1.49 million—has drawn attention not just for its timing but for what it signals about the company’s soaring ambitions. The raise, effective February 2024 at the start of NVIDIA’s fiscal 2025, comes amid a record-breaking year for the AI chipmaker, with revenue surging 114% to $130.5 billion. But this pay bump is more than a personal milestone: it reflects NVIDIA’s transformation into the linchpin of the global AI infrastructure boom.

The Pay Raise: A Decade in the Making

Huang’s compensation for fiscal 2025 totaled $49.9 million, a 46% increase from the prior year, driven by a sharp rise in stock awards ($38.8 million) and a variable cash bonus. The compensation committee cited “internal pay equity” with other executives and Huang’s “long tenure and leadership” as key factors. Crucially, the raise aligns with the 75th percentile of peer CEO salaries, suggesting nvidia is finally closing a pay gap that had persisted for over a decade.

The timing is no accident. NVIDIA’s stock price has skyrocketed ninefold since late 2022, and Huang’s equity stake—now worth roughly $94 billion—ties his personal fortune to the company’s success. The raise also coincides with unprecedented demand for NVIDIA’s AI chips, as enterprises and governments rush to build generative AI models and supercomputers.

Fueling the AI Revolution: NVIDIA’s Strategic Dominance

Huang’s pay raise isn’t just about past performance—it’s about future bets. NVIDIA’s fiscal 2025 first-quarter results, released in May 2024, underscore its stranglehold on the AI market:

Data Center Revenue: Soared to $22.6 billion (87% of total revenue), up 427% year-over-year, driven by sales of Blackwell architecture-based GPUs and cloud partnerships.
AI Infrastructure: The Blackwell platform, enabling trillion-parameter AI models, now powers nine supercomputers, including the top three on the Green500 list for energy efficiency.
Automotive Growth: Partnerships with BYD, XPENG, and Lucid Motors expanded the reach of NVIDIA’s DRIVE Thor platform, which integrates advanced AI capabilities into electric vehicles.

These initiatives are backed by bold financial moves: a ten-for-one stock split in June .2024 aimed to boost accessibility for small investors, while a 150% dividend hike signaled confidence in sustained cash flows.

Risks and Challenges Ahead

Despite its dominance, NVIDIA faces hurdles. The gaming segment—a once-reliable revenue stream—showed an 8% sequential decline in Q1 FY25, though it grew 18% year-over-year. This underscores a strategic pivot: NVIDIA is betting its future on AI infrastructure, even as it risks overexposure if demand slows.

Operational costs are also rising: R&D and operating expenses are projected to grow 40% year-over-year in 2025, reflecting investments in AI software, robotics, and global expansion (e.g., a new R&D hub in Vietnam).

Conclusion: A Pay Raise Warranted by AI’s Future

Jensen Huang’s pay bump is emblematic of NVIDIA’s historic shift from a graphics chipmaker to the world’s AI infrastructure leader. With Data Center revenue now 87% of total sales and stock prices up ninefold since 2022, the compensation committee’s decision to align his pay with peer CEOs seems justified.

The numbers tell the story: NVIDIA’s fiscal 2025 revenue is on track to hit $130.5 billion, with AI-driven segments like cloud computing and supercomputing driving growth. The Blackwell platform’s success, partnerships with AWS and Google Cloud, and breakthroughs in semiconductor manufacturing (e.g., cuLitho) all reinforce NVIDIA’s moat.

Investors should note that Huang’s equity stake—representing 3.5% of NVIDIA—ensures his interests remain tightly aligned with shareholders. As the AI revolution matures, NVIDIA’s leadership in hardware-software ecosystems and its CEO’s renewed incentive structure position the company to capitalize on what could be a decades-long trend.

For now, the pay raise isn’t just about compensation—it’s a stake in the ground for the future of computing.

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