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The euphoria that investors express in their purchase orders could support the company’s upward race: on Tuesday its shares gained almost 5% (4.60%) at the close of the day, increasing its stock market value, which has accumulated an advance of 170%. Today the financial markets of the United States will remain closed for the celebration of Juneteenth (day of the end of slavery).
The semiconductor designer Nvidia became the company with the largest market capitalization in the world on Tuesday, surpassing Apple and Microsoft, a symbol that represents the fever for generative artificial intelligence (AI) that drives the markets, according to information from Newsweek.
The group value of Santa Clara (California) reached 3,352 billion dollars, according to a calculation by the AFP agency. Nvidia, however, has not yet reached the absolute record that Apple reached on Monday, when it reached $3.376 billion.
The euphoria that investors express in their purchase orders for Nvidia, however, could support its bullish run: on Tuesday its shares gained almost 5% (4.60%) at the close of the day, increasing its stock market value. Today the financial markets of the United States will remain closed for the celebration of the juttenth (day of the end of slavery).
Since OpenAI’s chatbot ChatGPT was launched in November 2022, Nvidia’s price has increased eightfold, thanks to the popularity of its powerful microchips.
“We’ve been expecting this for some time,” said CFRA analyst Angelo Zino. “AI is disrupting the landscape. In the real world, and also in the markets,” he added, while highlighting that the semiconductor industry is the most important on Wall Street.
The recent split of its shares by 10, on June 7, contributed to further increasing the company’s value by fueling demand for a more accessible title.
The group produces powerful graphics cards (GPU), semiconductors capable of handling a considerable amount of calculations, necessary for generative AI. Generative AI produces texts, photos and videos, among others, from a request formulated in everyday language.
Although many technology giants such as AMD or Intel, as well as Apple or Microsoft, invest massively in AI, Nvidia has a comfortable lead in the semiconductor market for artificial intelligence.
Towards 4 billion?
“Nvidia GPU microchips are the new gold or the new oil of the technology sector,” consider analysts at Wedbush Securities. For them, Nvidia, Apple and Microsoft are “in the race towards $4 trillion in stock market value.”
For a quarter of a century, General Electric, ExxonMobil, Microsoft and Apple have followed one another on the “podium” of that competition, before Nvidia. Nvidia, Apple and Microsoft together account for around 10% of the total value of listed companies in the world.
Nvidia presented a new processor at the beginning of June, less than three months after its previous model, in a sector accustomed to interspersing its launches over several years. “On Wall Street, where capital is currently flowing, the ‘magnificent seven’ (as the big technology companies are known) continue to dominate the exchanges,” summarized Konstantin Oldenburger, analyst at CMC Markets.
“Nvidia is the company that creates the most value in the world right now,” said Adam Sarhan, of 50 Park Investments, alluding to generative AI, but also to the manufacturing of computers or the cryptocurrency industry, which is very demanding in data.
“This is the beginning of the AI boom,” he added.
After equipping servers around the world to run generative AI programs, the latest generation microchips, led by Nvidia, will be in individual devices such as smartphones, Angelo Zino anticipated. They will also be requested in the industrial sector, such as autonomous vehicles, the analyst added. “These are massive opportunities for Nvidia.”
