It's no secret that there's a financial frenzy brewing around artificial intelligence. But who do investors see as the biggest winner of the boom? That’s no longer a secret either. Nvidia, long known in the niche gaming community for its graphics chips, is now the most valuable public company in the world.
The year was 1999. Steve Jobs had just returned to lead Apple, Intel dominated the semiconductor industry, and a relatively unknown chipmaker named Nvidia debuted on the Nasdaq stock exchange. It took Nvidia 24 years to reach a market capitalization of $1 trillion, only 180 trading days to double to $2 trillion, and just 66 more days to hit $3 trillion. At this pace, the company could soon surpass the $4 trillion mark.
In early June, Nvidia topped $3 trillion, surpassing iPhone maker Apple – a milestone fueled by the relentless demand for AI chips and AI advancements. Just five years ago, Nvidia wasn't even among the top 20 companies by market capitalization.
Today, the chipmaker ranks first among the world's largest companies after an extraordinary ninefold increase in value in less than two years. Nvidia stock surged past Microsoft to claim the top spot as the world’s most valuable company. With a valuation of $3.34 trillion, the chip giant rose 3.5% on Tuesday, edging out Microsoft, which now holds the second spot at $3.32 trillion.
Over the year, Nvidia shares have climbed over 185%, and the stock went even higher after the company reported first-quarter earnings in May.
The stock has increased more than ninefold since the end of 2022, coinciding with the rise of generative artificial intelligence.
Nvidia controls about 80% of the market for AI chips used in data centers, a sector that has expanded rapidly as OpenAI, Microsoft, Alphabet, Amazon, Meta, and others rush to acquire the processors necessary for building AI models and handling increasingly large workloads.
What’s next? The future looks bright for the world’s most valuable company. Earlier this week, Wall Street analysts set an optimistic price target for Nvidia at $160 a share. If achieved, this would push the company to an unprecedented $4 trillion valuation.
This article was written in cooperation with TradingView