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NVIDIA’s market value growth has been staggering. The company expanded from a $1 trillion market cap to $2 trillion in just nine months, and it took a little over three months to jump to $3 trillion in June read more
 "How NVIDIA leapt over Apple and Microsoft to become the most valued company at $3.32tn")
NVIDIA CEO Jensen Huang is often called the Taylor Swift of the tech world for his popularity among NVIDIA's investors. Image Credit: Reuters
In a remarkable turn of events, NVIDIA has overtaken Apple and Microsoft in one single day to become the world’s most valuable company. The chipmaker’s shares surged by 3.2 per cent on Tuesday, reaching $135.21 and boosting its market capitalization to an astonishing $3.34 trillion.
As of writing this piece, NVIDIA stood at $3.34 trillion. Microsoft stands second with a mar cap of $3.32 trillion, whereas Apple was at the third step with $3.29 trillion.
This achievement comes shortly after NVIDIA momentarily surpassed Apple to claim the position of the second most valuable company, last week, before it again fell back to the third position.
NVIDIA’s stock has skyrocketed by about 173 per cent this year, in stark contrast to Microsoft’s 19 per cent increase.
This phenomenal growth is driven by the soaring demand for NVIDIA’s advanced processors, which are pivotal in the race to dominate artificial intelligence (AI) technology.
NVIDIA’s historic bull run
Major tech companies like Microsoft, Meta Platforms, and Alphabet are fiercely competing to expand their AI capabilities. However, NVIDIA has complete control of the\ as they are the ones supplying the crucial hardware.
The chipmaker’s impressive stock performance reached a new peak on Tuesday, adding over $103 billion to its market value. Recently, NVIDIA made its shares more accessible to individual investors by implementing a ten-for-one stock split on June 7. “A stock split can reduce the price per share, making it more affordable for individual investors to buy. With NVIDIA doing a 10:1 stock split, retail investors are the real winners here,” said Sam North, a market analyst at investment platform eToro.
NVIDIA’s market value growth has been staggering. The company expanded from a $1 trillion market cap to $2 trillion in just nine months, and it took a little over three months to jump to $3 trillion in June.
The NVIDIA story
In May 2023, NVIDIA stunned everyone when its financial results surpassed even the most optimistic Wall Street expectations. The company forecasted quarterly sales that were over 50 per cent higher than the average projections.
For the first time in fiscal 2023, NVIDIA’s data centre sales exceeded its gaming revenue, marking a significant milestone. Analysts predict that in NVIDIA’s current fiscal year, which ends in January, these sales will surpass $100 billion.
Founded in 1993, NVIDIA’s journey to the top has been nothing short of extraordinary. When NVIDIA debuted on the Nasdaq stock exchange in 1999, Intel was King of Hill that is the computer microprocessor and semiconductors. In less than three years, the company joined the S&P 500.
Since its initial public offering, NVIDIA’s total return, including reinvested dividends, stands at an eye-popping 591,078 per cent, making it one of the best-performing stocks of the last quarter-century.
However, everything hasn’t been hunky dory for NVIDIA’s investors. The company has seen multiple instances where its value was slashed by almost 50 per cent, on two separate occasion. However, that is a thing of the past.
To OpenAI’s credit…
NVIDIA’s rise is significantly attributed to its strategic focus on graphics chips and the vision of co-founder and CEO Jensen Huang, who foresaw the industry’s shift towards “accelerated computing.”
A major boost for NVIDIA came with the release of OpenAI’s ChatGPT in late 2022. Although it took some time for investors to recognize the potential benefits for NVIDIA, the growing interest in generative AI products like ChatGPT led to a surge in orders for NVIDIA’s chips.
The cryptocurrency boom also played a crucial role in NVIDIA’s ascent as it laid the foundation for NVIDIA to be the rockstar of the stock that it is today. Over the past four to five years, crypto miners and GPU scalpers have driven up demand for NVIDIA’s GPUs, often paying hefty premiums. These premiums sometimes would be 100 per cent of the MSRP of these cards. This trend significantly contributed to NVIDIA’s stock rally during numerous crypto rushes.
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English (US) ·