The AI boom continues to reshape power dynamics in Silicon Valley. As of Tuesday, U.S. microchip manufacturer Nvidia has become the world’s most valuable company by market capitalization. Nvidia’s stock rose by 3.5 percent, reaching a market value of $3.349 trillion (approximately €3.12 trillion), surpassing tech giants Microsoft and Apple. This marks a significant milestone in Nvidia’s impressive ascent over the past 18 months.
Just two weeks ago, Nvidia became only the third company to achieve a market capitalization of $3 trillion, joining the ranks of Apple and Microsoft.
In May, Nvidia once again reported exceptionally strong financial results: the California-based company’s net profit increased sevenfold compared to the same quarter last year, reaching $14.9 billion, while revenue nearly quadrupled to $26 billion.
Until two years ago, Nvidia was primarily known to the general public as a manufacturer of graphics chips for gaming computers. However, the company’s semiconductors are also crucial for numerous new applications of artificial intelligence (AI). With the onset of the AI boom, Nvidia’s rise has been meteoric.
Nvidia’s chips play a pivotal role, particularly in training AI software in data centers. The company sells thousands of chip systems to major corporations, including Microsoft, Google, and Facebook’s parent company Meta.
Stock Prices Continue to Soar
Since the beginning of the year, shares of this leading AI company have nearly doubled in value again, while Apple shares have gained less than two percent. During the same period, the technology-heavy U.S. index has risen by about 13 percent.
The disparity has only grown since AI became a dominant theme in public discourse and financial markets. Since the end of 2022, Nvidia’s stock price has increased by more than 700 percent, compared to a 50 percent increase for Apple. Microsoft’s market value has risen by nearly 80 percent during this time, roughly in line with the overall Nasdaq 100 index.
Due to this stock rally, co-founder and CEO Jensen Huang has become one of the world’s richest individuals. According to Bloomberg, he holds 3.5 percent of Nvidia’s shares, with his net worth currently estimated at $107 billion, primarily derived from his Nvidia stock holdings. Huang is currently ranked 13th on Bloomberg’s list of billionaires.