Nvidia's market capitalization surpassed $3 trillion for the first time, making it the world's second-most valuable publicly traded company after Microsoft ($3.15 trillion).
Nvidia's stock price surged by over 147% in 2024, reaching around $1,224 per share, driven by investments in AI and high demand for its GPU chips for machine learning from tech giants like Google, Microsoft, and Meta.
Nvidia reported a revenue of $26 billion in Q1 2024, tripling from the previous year, and expects around $28 billion in revenue for Q2, exceeding Wall Street expectations. The company plans a 10:1 stock split on June 7 to make shares more affordable and increase demand.
Nvidia holds an estimated 80% market share in AI chips for data centers, with revenue surging 262% in May, driven by sales of its "Hopper" chips. The data center business revenue grew 427% year-over-year to $22.6 billion.
Nvidia's dominant position in AI-powering chips and its unique, fast-produced chips make it a major supplier to companies like Apple, Meta, and Microsoft, with Microsoft accounting for an estimated 15% of Nvidia's revenue.
The shift in market value over Apple signals a change in Silicon Valley dominance, as Nvidia's CUDA platform offers a strong advantage and potential for long-term growth, while some investors view Apple as lagging behind other tech giants in AI.
Nvidia's stock performance has significantly influenced the S&P 500 index this year, raising concerns about a potential bubble, while its valuation at 42 times expected earnings is high but not at an all-time high. Despite competition from AMD and Intel, Nvidia remains a dominant force in providing advanced hardware and software for AI workloads.
Sources: MarketWatch, The Hill, Bloomberg, BBC, The Guardian, Business Insider, CNBC, FT, Forbes, New York Post, Mashable, The Verge, The Information, South China Morning Post
This article was written in collaboration with Generative AI news company Alchemiq.
