London – Nvidia's relentless stock price rise has pushed the semiconductor giant's market capitalization beyond that of other major tech companies, helping it claim the title of the world's most valuable company as the artificial intelligence (AI) wave continues.
The company's shares rose 3.5% on June 18 to close at $135.58 per share, giving the company a market capitalization of about $3.3 trillion (S$4.5 trillion), surpassing that of Microsoft and Apple.
Nvidia surpassed Apple in market capitalization for the first time since 2002 in early June, and the two companies have been swapping positions in recent days. Apple briefly overtook Microsoft for the top spot last week.
The ranking is a fresh reminder that AI is a top concern for many investors. Nvidia, which dominates the market for highly popular chips that power data centers carrying out the complex computing tasks required for AI applications, is seen as one of the technology's biggest and earliest beneficiaries.
Demand for its H100 accelerators is booming, with the chipmaker's sales expected to increase by more than 125% in 2023.
Meanwhile, Microsoft is also seen as an early AI winner thanks to its investment and partnership with OpenAI, the company that developed ChatGPT, and Apple's shares rose this week after the iPhone maker finally announced its plans to use the technology, finally appeasing investors.
“Over the next 12 months, the race for $4 trillion in tech market cap will likely be between Nvidia, Apple and Microsoft,” Wedbush Securities analyst Daniel Ives wrote in a note.
Nvidia's soaring stock price has made co-founder and CEO Jensen Huang one of the world's richest people. His net worth has risen by nearly $75 billion since the start of 2024 to $119 billion, putting him at No. 12 on the Bloomberg Billionaires Index, the biggest increase of any billionaire.
Investors join Hwang in arguing that Nvidia is more than just a chipmaker.
“They're not just selling chips, they're selling systems,” Michael Lippert, vice president and portfolio manager at Baron Capital, said in an interview, pointing to the company's proprietary software and development ecosystem.
NVIDIA is one of the few companies to show significant revenue growth in AI, and its rapid rise to the top has been record-breaking: its stock price rose more than 170% by the closing price on June 18, 2024, adding more than $2 trillion to its market cap.
“With the Fourth Industrial Revolution in full swing and more businesses and consumers rapidly embarking on this path, Nvidia's GPU chips are essentially the new gold or oil in tech,” Ives said. Bloomberg
