Nvidia’s market value has soared past $3 trillion (£2.3 trillion), surpassing Apple to become the world’s second most valuable publicly listed company.
The chip giant’s share price climbed over 5% on Wednesday, reaching more than $1,224.
This marked the continuation of a rapid ascent that began last year, driven by expectations that Nvidia will be a significant beneficiary of the substantial investments in artificial intelligence (AI).
Currently, Nvidia’s market value is second only to Microsoft, another major player in the AI industry due to its investments in OpenAI, the creator of ChatGPT.
Nvidia, which was valued at “just” $2 trillion as recently as February, ignited a fresh wave of share purchases after announcing plans for a stock split last month.
This move, set to occur on Friday, will increase the number of shares by a factor of 10 and reduce their value accordingly, making them more accessible to smaller investors.
The stock split is expected to further boost demand for Nvidia shares.
Nvidia, founded in 1993, initially gained recognition for its graphics processing chips used primarily in computer gaming.
However, well before the AI boom, the company began incorporating features into its chips to enhance machine learning capabilities, significantly boosting its market share.
Now, Nvidia is considered a pivotal company in observing the proliferation of AI-powered technology across the business sector, a transformation that CEO Jensen Huang has dubbed the beginning of the “next industrial revolution.”
The company’s explosive growth is evident in its recent financial performance, with sales hitting $26 billion in the three months ending on April 28—more than triple the amount during the same period in 2023, and an 18% increase from the previous quarter.
The optimism surrounding AI has also contributed to a broader market rally over the past year, driving the S&P 500 and Nasdaq in the U.S. to new record highs on Wednesday.
Apple, meanwhile, experienced some setbacks earlier this year due to stalled sales growth. However, its shares have recently rebounded, buoyed by anticipation regarding the company’s AI strategy.
Apple shares rose by 0.7%, resulting in a market capitalization of roughly $3 trillion, calculated by multiplying the number of shares by the current share price.
Source-BBC
