Nvidia Nears Trillion Dollar Valuation as Stocks Soar: The AI Boom Propels NVDA
Nvidia (NVDA 0.13%) is on the verge of a monumental milestone. After a phenomenal Thursday, with stocks rising over 20%, the company is nearing a trillion-dollar valuation, driven by its pivotal role in the AI revolution. The surge in Nvidia stock comes after the heavyweight chipmaker’s quarterly report beat expectations, leading to Wall Street’s largest one-day gain in history, with Nvidia adding $277 billion in stock market value on Thursday alone.
The chip maker's journey to this point has been remarkable. It took Nvidia NVDA 0.13% 24 years as a public company for its valuation to reach the rarefied air of $1 trillion. But the AI boom has accelerated its growth exponentially. With its shares soaring by a staggering 59% since the start of the year, Nvidia is racing toward an unprecedented $2 trillion valuation. This would mark a historic moment, solidifying Nvidia's dominance in the artificial intelligence landscape.
Fueled by the demand for its powerful GPUs, essential for AI training and inference, Nvidia's valuation had a phenomenal Thursday. The company shared its quarterly sales outlook on May 25, and it is nearing a trillion-dollar milestone. In fact, Semiconductor firm Nvidia became the first in the chip industry to reach a $2 trillion valuation after shares of the company increased around 3% Friday morning.
Nvidia's impact extends beyond its own success. Nvidia, along with tech giants Amazon, Google, Microsoft, and Apple, are worth $14.5 trillion and make up about 32% of the S&P 500, highlighting the concentration of value within the technology sector. The AI market's continued growth is further boosting Nvidia's prospects. Analysts predict Nvidia's valuation could soon surpass $4 trillion amid ongoing AI market growth.
Nvidia stock soared as much as 5% on Wednesday to hit a record high, reflecting investor confidence in the company's future. The race to a trillion-dollar valuation and beyond signifies Nvidia's transformation from a graphics card manufacturer to a leading force in the AI era, solidifying its position as a key player in the global technology landscape. The potential for further growth remains substantial as AI continues to permeate various industries.