Nvidia Tops the Tech World: Becomes Most Valuable Company Globally
Nvidia is a leading chip maker that recently became the world’s most valuable company after its share price hit an all-time high on Tuesday. The company is now worth $3.34 trillion (£2.63 trillion), with its stock price nearly doubling since the start of this year.
The stock closed the trading day at almost $136, up 3.5% and by this, Nvidia became a tech giant. It had surpassed Microsoft and Apple earlier this month.
Nvidia’s remarkable rise is due to its strong position in producing the chips essential for artificial intelligence (AI), which analysts call the “new gold or oil in the tech sector.”
At an event in Copenhagen Nvidia’s global head of business development for telecommunications Chris Penrose expressed gratitude. He credited over 30 years of work in AI for the achievement and thanked partners and collaborators.
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Penrose also said, “The generative AI journey is really transforming businesses and telcos around the world. We’re just at the beginning.”
Analysts at Wedbush Securities echoed this optimism. “We believe over the next year the race to a $4 trillion market cap in tech will be front and center between Nvidia, Apple, and Microsoft,” they stated in a note earlier this week.
However, nothing is permanent in the market due to increasing competition.
Nvidia’s growth has been spectacular. Eight years ago its stock was worth less than 1% of its current price. At that time Nvidia competed with AMD to make the best graphics cards. Recently because of the demand for chips used in AI models like OpenAI and ChatGPT the growth increased.
The company’s success has elevated the profile of its CEO, Jensen Huang, who has been called the “Taylor Swift of tech” for his celebrity-like status.
The competition in AI development is intense, with Microsoft, Google’s parent company Alphabet, Meta, and Apple all striving to create leading AI products. This rivalry benefits Nvidia, which not only develops its own AI technology but also dominates the AI chip market.
Nvidia’s sales and profits have often exceeded analyst expectations. In May, following the release of its latest financial results, Quilter Cheviot technology analyst Ben Barringer said the company had “once again cleared a very high hurdle.” He added, “Demand is showing no signs of switching off either.”
Barclays credit analyst Sandeep Gupta warned that maintaining Nvidia’s large market share might be difficult because of more competitors entering the market. He also questioned how Nvidia’s customers would profit from AI software. Many other market experts also showed the same concern.
