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Thursday, June 13, 2024

Nvidia Tops $3 Trillion Market Cap, Surpasses Apple

Nvidia Tops $3 Trillion Market Cap, Surpasses Apple

Nvidia achieved a significant milestone by surpassing a $3 trillion market cap, overtaking Apple to become the second most valuable public company in the United States on Wednesday (June 5).

Following a 5% increase in its stock, Nvidia’s market value reached $3.019 trillion at market close, surpassing Apple’s $2.99 trillion, as reported by CNBC.

Currently, Nvidia is second only to Microsoft, which had a market value of $3.15 trillion at market close. Microsoft overtook Apple earlier this year to become the most valuable U.S. company.

Apple, once the leader and the first company to reach $1 trillion and subsequently $2 trillion in market cap, has seen its growth slow this year due to challenges such as reduced demand in China, manufacturing issues, and the mixed reception of its mixed-reality headset, Vision Pro.

Investor interest in artificial intelligence (AI) infrastructure has boosted both Microsoft and Nvidia. Nvidia, which produces AI chips, holds approximately 80% of the market share for data center chips.

Fueled by the AI boom, Nvidia’s shares have surged 24% since its first-quarter earnings report in May and an astounding 3,290% over the past five years.

Nvidia’s May 22 earnings report exceeded Wall Street expectations, providing reassurance to investors and analysts closely monitoring the AI industry’s progress. The chipmaker reported a quarterly revenue increase of 18% compared to the previous quarter and a 262% increase year-over-year.

Nvidia’s founder and CEO, Jensen Huang, credited the revenue growth to partnerships with companies and countries transitioning from traditional data centers to “AI factories,” which are expected to enhance productivity across various industries.

On June 2, Huang announced that Nvidia plans to update its AI accelerators annually, with the Blackwell Ultra chip set for release in 2025 and a next-generation AI platform debuting in 2026. Huang anticipates widespread adoption of generative AI by more companies and government agencies.

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