Nvidia Corp., already the world’s most valuable semiconductor firm, has made history by becoming the first computer-chip company to reach a $3 trillion market capitalization. This milestone has also elevated Nvidia to the position of the world’s second-most valuable company, trailing only Microsoft Corp.
KEY HIGHLIGHTS:
- Market Capitalization Milestone:
- Nvidia’s shares have surged approximately 147% this year, adding about $1.8 trillion to its market value, fueled by the soaring demand for its chips used in artificial intelligence (AI) tasks.
- On Wednesday, Nvidia’s shares rose by 5.2%, closing at a record $1,224.40, pushing its market value past the $3 trillion mark and overtaking Apple Inc.
- Historical Context:
- The last time Nvidia’s market value surpassed Apple’s was in 2002, a time when both companies were valued at less than $10 billion each, and five years before the first iPhone was released.
- Future Outlook and Innovations:
- Nvidia’s CEO, Jensen Huang, announced plans to upgrade the company’s AI accelerators annually, ensuring the firm maintains its competitive edge.
- Huang emphasized Nvidia’s pivotal role in the rise of generative AI, likening it to a new industrial revolution. He expressed confidence in the continued expansion of AI technology into personal computers.
- Impact on CEO’s Wealth:
- The recent stock gains increased Jensen Huang’s wealth by over $5 billion, bringing his total to $107.4 billion according to the Bloomberg Billionaires Index.
- Market Analysts’ Perspective:
- Angelo Zino, a senior equity analyst at CFRA Research, highlighted the “improved visibility” and “greater momentum” in Nvidia’s GPU/CPU/networking sectors, which are expected to drive further growth and exceed consensus estimates.
- Comparison with Rivals:
- Despite its impressive growth, Nvidia still trails behind Microsoft in market value. However, with its current momentum, many on Wall Street believe it’s only a matter of time before Nvidia could surpass Microsoft as well.
- Apple has faced challenges this year, including concerns over declining iPhone demand in China and regulatory fines from the European Union. These issues have kept Apple’s stock performance subdued, although recent improvements in investor sentiment have turned its shares positive for 2024.
NVIDIA STOCK PRICE
CONCLUSION:
Nvidia’s remarkable ascent to a $3 trillion market cap underscores the pivotal role of AI technology in shaping the future of the semiconductor industry. The company’s continuous innovation and strategic focus on AI accelerators position it as a leader in the ongoing technological revolution. As Nvidia’s influence and market value grow, the company is poised to challenge the top tech giants, marking a significant shift in the global technology landscape.
