Nvidia’s market value soared to unprecedented heights, making it the world’s most valuable company valued at $3.34 trillion, nearly doubling since the beginning of the year.
The surge in share price, closing at nearly $136, reflects a 3.5% increase and places Nvidia ahead of tech giants like Microsoft and previously Apple.
The company’s remarkable ascent is attributed to its dominance in supplying chips crucial for artificial intelligence (AI) applications, deemed the “new gold or oil in the tech sector” by analysts.
Chris Penrose, Nvidia’s global head of business development for telco, highlighted the culmination of over 30 years of work in computing and AI, predicting continued growth in the sector with generative AI’s transformative impact on businesses and telecommunications.
Analysts at Wedbush Securities foresee a race to a $4 trillion market cap in tech involving Nvidia, Apple, and Microsoft.
Despite such optimism, some commentators have raised concerns about Nvidia’s future gains amid intensifying competition.
Nvidia’s trajectory from a competitor in graphics cards to an AI chip market leader has been dramatic, particularly with the surge in demand for chips powering AI models like OpenAI’s ChatGPT.
The company also benefited from the Bitcoin mining rush in 2020, boosting sales of its graphics cards.
The rise of Nvidia parallels the prominence of its CEO, Jensen Huang, likened to the “Taylor Swift of tech” for his celebrity status in the industry.
While competition among AI developers is fierce, Nvidia’s strong position in the AI chip market and consistent financial performance have impressed analysts, with demand showing no signs of waning.
However, some analysts caution about sustaining Nvidia’s market share amidst growing competition and uncertainties about monetizing AI software.
Source-BBC
