The market value of Nvidia has formally reached $1 trillion. Following its ongoing ascent amidst the recent popularity of AI, this feat was revealed. Additionally, with its stock currently trading at more than $400 a share, this accomplishment has made the business the first chipmaker to ever accomplish the feat.
The California-based business has surpassed the market valuation number alongside a number of other tech behemoths. These specifically include well-known companies like Apple, Amazon, Microsoft, Alphabet, and Google. However, this year’s 165% rally has contributed to its growth.
The Reason Behind the Achievement
The age of AI has truly arrived on the globe. This assertion is a reflection of both the growing use of generative AI and artificial intelligence in general. The tech sector has witnessed its next major transformation following the viral sensation of businesses like OpenAI and its chatbot ChatGPT which paved the way for it.
The chipmaker Nvidia currently has a market valuation of more than $1 trillion thanks to riding that wave. It’s also important to note how much the chip industry has benefited from the rise of AI. Specifically due to the creation of goods that benefit the industry, such as graphics card sans server.
The recent increase in Nvidia’s market capitalization became apparent shortly after a number of new projects were announced. The business also unveiled a brand-new supercomputer and a platform for generative AI to support the creation of video games.
Following the release of its quarterly results last week, it was noted that the company’s shares had surged 26% as a result of these new advances. According to reports, the increase exceeded expectations.
The business also stated that it expected revenue of $11 billion for the second quarter. It is also important to note that Srini Pajjuri, managing director of Raymond James, recently reviewed the business in a note to investors. He claimed, “There’s a war going on in AI, and Nvidia today is the only arms dealer out there.”
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Nvidia’s Rising Shares
In addition to the current boost brought on by the use of AI, it is clear that Nvidia shares have had an incredible surge this year. which has increased by more than 165% since the beginning of 2023.
The chipmaker’s powerful graphics cards and server solutions have put it in the middle of the current AI obsession. According to John Vinh, an equity research analyst at KeyBanc Capital Markets, “It’s something that they have earned.”
Additionally, last Thursday’s share price of Nvidia increased by more than 26% as a result of the company’s better-than-expected quarterly results and guidance. For the second quarter, the business projects revenue of $11 billion, plus or minus 2%. $7.2 billion was sought after by Wall Street.