Jim Cramer Sold 1 AI Chipmaker Over $80 Billion in Debt. But He Defended NVIDIA

Financial commentator Jim Cramer drew attention across Wall Street after exiting his position in Broadcom while strongly defending NVIDIA, despite both AI chipmakers utilizing vendor financing structures. The divergence in stance centers on balance sheet strength and financial leverage. While Broadcom faced scrutiny and investor caution over potential debt raises of up to $80 billion to fund chip deals, NVIDIA operates from a fortress balance sheet characterized by a debt-to-equity ratio of 0.07, net debt-to-EBITDA of 0.006, and interest coverage of 503x. NVIDIA generated $49 billion in quarterly free cash flow in April, enabling it to fund organic investments, return $20 billion to shareholders, and authorize an $80 billion share repurchase plan without relying on heavy bond market borrowing. Heading into its upcoming quarterly report, market expectations remain elevated following previous revenue of $82 billion and projected guidance of $91 billion with 75% non-GAAP gross margins, determining whether NVIDIA can sustain its multi-trillion-dollar valuation advance toward prior record highs.