Nvidia value has surged past $3 trillion amid growing enthusiasm for AI.
Nvidia, the chip maker, is now valued at over $3 trillion, surpassing Apple to become the world’s second most valuable company.
The company has experienced an astonishing surge in its share value, driven by the excitement surrounding the possibilities of artificial intelligence, which relies heavily on chips produced by Nvidia.
This surge in popularity has made Nvidia the largest company in Silicon Valley, dethroning Apple. Apple’s share price has declined due to concerns over iPhone sales in China and other issues.
This surge in popularity has made Nvidia the largest company in Silicon Valley, dethroning Apple. Apple’s share price has declined due to concerns over iPhone sales in China and other issues.
Nvidia’s surge in market value surpassing Apple marks a significant shift in Silicon Valley, where the company co-founded by Steve Jobs has held dominance since the launch of the iPhone in 2007.
Nvidia’s stock rose by 5.2%, closing at $1,224.40, and valuing the company at $3.012 trillion. Meanwhile, Apple’s market capitalisation stood at $3.003 trillion after a 0.8% increase in its stock price.
Based in Redmond, Washington, Microsoft remains the world’s most valuable company, with a market capitalization of $3.15 trillion, following a 1.9% increase in its share price.
“Nvidia is making money on AI right now, while companies like Apple and Meta are spending on AI,” said Jake Dollarhide, chief executive officer at Longbow Asset Management.
“It may be a foregone conclusion that Nvidia will also overtake Microsoft. There’s a lot of retail money piling in, seeing it as a straight shot up,” said Jake Dollarhide.
Nvidia’s stock surged 147% in 2024, driven by soaring demand for its top-of-the-line processors. The demand far outpaces the supply as tech giants like Microsoft, Meta Platforms, and Google-owner Alphabet race to bolster their AI computing capabilities and establish dominance in this emerging technology sector.
Since May 22, Nvidia has rallied nearly 30% following its latest stellar revenue forecast issuance.
On Wednesday, Nvidia added nearly $150 billion in market capitalisation, surpassing the entire value of AT&T.
Optimism surrounding AI propelled chip stocks on Wednesday, with the PHLX chip index soaring by 4.5%. Super Micro Computer, a provider of AI-optimised servers equipped with Nvidia chips, saw a 4% increase in its stock price.
The company’s CEO Jensen Huang, garnered extensive coverage on Taiwanese television this week and received overwhelming attention from attendees during his visit to the Computex tech trade fair in Taipei, his birthplace, before relocating to the United States.
As Nvidia rides the wave of AI enthusiasm on Wall Street, Apple grapples with weak demand for iPhones and formidable competition in China, the world’s largest smartphone market.
Some investors perceive Apple as lagging behind technology heavyweights as they rush to integrate AI features into their products and services.
Analysts’ forecasts for Nvidia’s future earnings have surpassed its remarkable stock gains. Nvidia is currently trading at 39 times expected earnings, marking a decrease in valuation compared to a year ago when it traded at over 70 times expected earnings, according to LSEG data.
