AI chip giant NVIDIA reached a market value of over 3 trillion U.S. dollars for the first time on Wednesday, setting a new historical high and surpassing Apple to become the world’s second-largest company in terms of market value, only behind Microsoft.
Starting on the 7th, NVIDIA will implement a 1-for-10 stock split, making it more advantageous for investors to increase their holdings. This move has also driven NVIDIA’s stock price to new highs day after day, with a 5.16% surge on Wednesday, closing at 1224 U.S. dollars. The market value reached 3.011 trillion U.S. dollars, making it the third member of the 3 trillion U.S. dollar club in U.S. stock market history.
Simultaneously, NVIDIA has surpassed Apple to become the world’s second-largest company by market value. Apple only saw a slight increase of 0.78% on Wednesday, with a market value of about 3.003 trillion U.S. dollars. The current market value of the world’s largest company, Microsoft, is approximately 3.151 trillion U.S. dollars. This means that NVIDIA only needs to rise by 5% to surpass Microsoft and become the world’s largest company.
NVIDIA has made significant progress this year as demand for AI chips has surged. The company’s stock has risen by about 147% so far this year, increasing its market value by about 1.8 trillion U.S. dollars. The last time NVIDIA’s market value exceeded that of Apple was in 2002, when both companies had market values of less than 10 billion U.S. dollars, five years before the first generation iPhone was released.
NVIDIA shows no signs of slowing down or allowing competitors to catch up. NVIDIA CEO Huang Renxun stated that the company plans to upgrade its AI accelerators annually. According to the Bloomberg Billionaires Index, Huang Renxun’s wealth increased by over 5 billion U.S. dollars on Wednesday, reaching 107.4 billion U.S. dollars.
During a keynote speech at National Taiwan University last week, Huang Renxun pointed out that the rise of generative AI is a new industrial revolution, and as AI technology turns towards personal computers, NVIDIA is expected to play a crucial role.
In terms of NVIDIA’s future prospects, Angelo Zino, senior equity analyst at CFRA Research, believes that the company is still at the beginning of a major transformation. Following Huang Renxun’s keynote speech, Zino likes the “increased visibility” and believes that strong momentum in GPU/CPU/networking will drive NVIDIA’s stock price to meet market expectations.
Although NVIDIA’s current market value still lags behind Microsoft, the gap between NVIDIA and Microsoft in terms of market value is not significant. Wall Street believes that it is only a matter of time before NVIDIA surpasses Microsoft.
Due to concerns about cooling demand for iPhones in China and pressure from EU fines, Apple has had a challenging year so far. It was not until recently, with investors slowly becoming more positive about Apple, that the outlook for Apple in 2024 turned positive, with a 5% increase in stock price year-to-date.