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Thursday, July 18, 2024

Nvidia Becomes World’s Most Valuable Company, Dethroning Microsoft

Nvidia Becomes World’s Most Valuable Company, Dethroning Microsoft

Chip giant’s market capitalization reaches $3.335 trillion as stock prices continue their remarkable rise.

Nvidia, the startup at the center of the artificial intelligence boom, has ascended to the position of the world’s most valuable company, surpassing Microsoft.

Nvidia’s market capitalization hit $3.335 trillion on Tuesday as its shares rose by 3.5 percent to $135.58.

The achievement comes just days after the Santa Clara, California-based company surpassed Apple to become the world’s second most valuable company.

Shares of Microsoft and Apple, now holding the no 2 and no 3 spots, dropped by 0.45 percent and 1.1 percent, respectively.

Nvidia’s surge, which has pushed the S&P 500 and Nasdaq indexes to record highs, continues a spectacular winning streak for the company. Its graphics processing units (GPUs) are crucial for AI development.

Fueled by high demand for its chips from tech giants like Microsoft, Meta, and Google, the company’s stock price has skyrocketed nearly 182 percent this year, following a more than threefold increase in 2023.

Nvidia controls about 80 percent of the market for AI chips used in data centers needed to run AI models like OpenAI’s ChatGPT.

Since its stock market debut in 1999, Nvidia shares have soared by 591,078 percent.

An investor who placed $10,000 into the company in 1999 would now have $59,107,800 worth of stock, according to the Kobeissi Letter newsletter on capital markets.

Initially, Nvidia focused primarily on producing chips for computer games.

However, during the 2000s, CEO Jensen Huang steered the company towards developing GPUs for applications beyond gaming, positioning it to capitalize on the rise of AI.

Nvidia’s remarkable ascent has made Huang one of the world’s richest individuals, with an estimated net worth of over $117 billion, according to Forbes.

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