Nvidia Corporation has achieved a historic milestone by becoming the first computer-chip company ever to surpass the $3 trillion mark in market capitalization. The Santa Clara, California-based semiconductor giant's shares have soared by approximately 147% this year, adding a staggering $1.8 trillion to its market value. This remarkable achievement is propelled by the relentless demand for Nvidia's chips, particularly in powering artificial intelligence (AI) tasks, which have seen unprecedented growth.
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On Wednesday, Nvidia's shares experienced a significant surge of 5.2%, closing at a record high of $1,224.40. This surge propelled Nvidia's market value beyond $3 trillion, surpassing tech titan Apple Inc. in the process. The last time Nvidia held a higher market value than Apple was in 2002, a remarkable feat considering that both companies were worth less than $10 billion each at the time.
Nvidia's CEO, Jensen Huang, has emphasized the company's commitment to innovation and staying ahead of the competition. Huang announced plans to upgrade Nvidia's AI accelerators annually, ensuring the company remains at the forefront of the rapidly evolving technology landscape. This commitment to advancement has not only solidified Nvidia's position in the AI sector but has also contributed to Huang's personal wealth, increasing by over $5 billion to $107.4 billion.
Huang sees the rise of generative AI as a "new industrial revolution" and believes Nvidia will play a pivotal role as AI technology continues to integrate into personal computers.
According to BIS Research, the AI and Semiconductors market is growing at a CAGR of 31.99% and expected to grow at this consistent rate till 2028.
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Nvidia's success can be largely attributed to its dominance in the AI space, with the company being one of the primary beneficiaries of the surge in AI spending. As a result, Nvidia is now in a race with tech giant Microsoft Corp. to claim the title of the world's most valuable company. Although Nvidia still trails Microsoft in market value, Wall Street analysts are optimistic about its future prospects, with many predicting that Nvidia will soon overtake its competitor.
In contrast, Apple has faced challenges this year, with concerns over cooling iPhone demand in China and regulatory issues in the European Union. However, there are signs of improvement as investor sentiment toward Apple has recently turned positive, with shares in the company showing gains for 2024.
Also Read: NVIDIA's Blackwell AI Platform is Set to Fuel Next-Gen Computing
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