Topline
Nvidia’s market capitalization surged past $1 trillion for the first time in the chipmaker’s history Tuesday, as the Silicon Valley behemoth rides Wall Street’s artificial intelligence obsession to new heights.
Key Facts
Shares of Nvidia rose 4% in early trading, representing a one-day gain of $40 billion and pushing the chipmaker’s market value to a hair over $1 trillion.
Nvidia is now the sixth public company in the world valued at over $1 trillion, joining Apple, Saudi Aramco, Microsoft, Alphabet and Amazon; the only other companies to ever cross the threshold are Tesla and Meta, which are each valued at less than $700 billion today, and Chinese oil giant PetroChina.
Joining the $1 trillion club follows a dramatic rise thus far in 2023, with Nvidia’s stock up more than 175% as Wall Street analysts say the Palo Alto-based company could be the firm best-positioned to profit off of the AI boom.
Key Background
Nvidia’s stock surged more than 10% following each of its earnings reports this year as investors’ imaginations for the company ran wild. The firm, which makes the chips powering generative AI computing in addition to a variety of software and hardware products, said last week it anticipates profits to be twice as high as expected during the current quarter thanks to AI-related sales. The stock’s dramatic rally year-to-date headlines a strong return for other mega-cap tech stocks, with each of Apple, Amazon, Microsoft, Meta and Tesla up 25% or more in 2023.
Crucial Quote
Generative AI marks a “a paradigm shift now translating into material early revenue for the leader in AI compute,” Cowen analyst Matthew Ramsay wrote to clients Thursday, referring to Nvidia.
Forbes Valuation
Nvidia’s cofounder and CEO Jensen Huang is worth an estimated $36 billion, making him the 34th-richest person in the world. Huang was the world’s 76th-richest person just two months ago, when he held a $21.1 billion fortune.
What To Watch For
Nvidia is now worth just $250 billion less than Amazon, a dramatic swing from last fall, when Nvidia was worth roughly $850 billion less than its fellow tech titan. In a note to clients last week, Rosenblatt analyst Hans Mosesmann set a price target for Nvidia’s stock which implied a nearly $1.5 trillion market cap for Nvidia. That would top Amazon and fall just shy of Alphabet.
Bigger Than Amazon? Nvidia Stock Surges After ‘Cosmological’ Profit Projections (Forbes)
Nvidia Nears $1 Trillion Market Capitalization—Closing In On These Other Companies (Forbes)
Gamers Are Angry At Stock Market Darling Nvidia—Here’s Why (Forbes)
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