May 24 (Reuters) – Artificial intelligence stocks closed Wednesday after chipmaker Nvidia (NVDA.O) predicted strong earnings growth and said it would ramp up production of AI chips to match. It surged in trading, increasing its market cap by nearly $300 billion. Soaring demand.
Nvidia shares soared 28% after the bell, trading at a record high of $391.50. This increased the company’s stock market value by nearly $200 billion to more than $960 billion, splitting the gap between Silicon Valley companies as the world’s most valuable chip maker and Wall Street’s fifth most valuable company. unfolded.
“Given the enthusiasm for AI and the fact that NVIDIA significantly exceeded its first quarter results and second quarter guidance, this is a good sign that AI is going strong,” said Daniel Morgan, senior portfolio manager at Synovus Trust in Atlanta. It shows real evidence of authenticity.” Morgan said Synovas owns Nvidia shares.
Nvidia expects quarterly sales to beat Wall Street estimates by more than 50%, and CEO Jensen Huang said in a statement that the company is “storing demand for data center chips. “We’re increasing supply,” he said.
Shares of other AI-related companies also rose on the strength of Nvidia’s report, adding another nearly $100 billion to the stock market value after the close.
Rival chipmaker Advanced Micro Devices (AMD.O) jumped 10%. Microsoft (MSFT.O) and Google parent Alphabet (GOOGL.O) each rose about 2% as they rush to bring generative AI to their web search platforms.
AI software maker C3.ai (AI.N) and Palantir Technologies (PLTR.N), which recently launched its own AI platform, both surged about 8%.
Interest in AI increased after startup OpenAI introduced ChatGPT this year, gaining over 1 million users within a week. Using historical data, generative AI can create new content such as fully formalized text, images, and software code.
Ahead of Nvidia’s report on Wednesday, optimism about AI has already driven a 109% rise in the company’s share price through 2023, with the chip maker top performer in the S&P 500 (.SPX) year-to-date. It’s becoming The rise has boosted Nvidia’s projected earnings by about 60 times, nearing a peak of 68 times its expected earnings in 2021, according to Refinitiv data.
Reported by Noel Randewich in Oakland, CA; edited by Sinead Carew in New York with Matthew Lewis
Our standards: Thomson Reuters Trust Principles.
