Nvidia has overtaken Microsoft as the most valuable business in the world, thanks in large part to its high-end processors, which are crucial in the competition to dominate artificial intelligence technologies.
The chipmaker's market value increased to $3.335 trillion, or 3.5%, on Thursday, only days after it surpassed Apple, the maker of the iPhone, to take the second place.
Microsoft's shares fell 0.45%, bringing its stock market worth down to $3.317 trillion. Apple's market capitalization decreased by more than 1% to $3.286 trillion.
The extraordinary increase in Nvidia's market capitalization over the last 12 months has come to represent a Wall Street panic sparked by hope for the future of artificial intelligence.
Although the S&P 500, and Nasdaq have reached all-time highs thanks to Nvidia's surge, some investors are concerned that unfettered euphoria about artificial intelligence (AI) might vanish if indications of a slowdown in expenditure on the technology surface.
"We're all just trading in it; it's Nvidia's market," stated Interactive Brokers chief market strategist Steve Sosnick.
Based on LSEG statistics, Nvidia has emerged as the most traded business on Wall Street, with an average daily turnover of $50 billion, compared to about $10 billion for Apple, Microsoft, and Tesla. Currently, the chip manufacturer represents around 16% of total S&P 500 company trade.
While Microsoft's stock has increased by around 19% this year, Nvidia's price has nearly quadrupled as a result of demand for its top-tier chips exceeding supply.
Alphabet, the parent company of Google, Microsoft, and Meta Platforms are vying with each other to develop AI computing capabilities and incorporate the technology into their goods and services.
Since Nvidia's AI chips are so much sought after and are thought to be far better than those of its rivals, there is a shortage of them. In the eyes of many investors, Nvidia is the biggest beneficiary of the current surge in AI development.
"Nvidia has been getting a lot of positive attention and has been doing a lot of things very correctly, but a small misstep is likely to cause a major correction in the stock, and investors should be careful," said Oliver Pursche, senior vice president at Wealthspire Advisors in New York.
With Tuesday's increase, Nvidia's market capitalization increased by almost $110 billion, or the full value of Lockheed Martin, and its stock reached a record high.
In just nine months, the company's market worth increased from $1 trillion to $2 trillion in February, and it took slightly more than three months to reach $3 trillion in June.
With demand for its graphics chips far exceeding supply as businesses scramble to integrate AI applications, the company has routinely blown past Wall Street's high expectations for revenue and earnings since its explosive prediction nearly a year ago.
It was in May when Nvidia officials stated that demand for their Blackwell AI processors would outpace supply "well into next year."
Nvidia's stock has gained dramatically, but analyst estimates for its future profits have sharply increased faster, which has caused a decline in the firm's earnings value.
According to LSEG statistics, Nvidia was trading at 44 times forecast profits as of late, down from over 84 approximately a year ago.
Nvidia divided its shares 10 for 1 last week, making its highly valued stock more appealing to individual investors.
(Source:www.marketscreener.com)
The chipmaker's market value increased to $3.335 trillion, or 3.5%, on Thursday, only days after it surpassed Apple, the maker of the iPhone, to take the second place.
Microsoft's shares fell 0.45%, bringing its stock market worth down to $3.317 trillion. Apple's market capitalization decreased by more than 1% to $3.286 trillion.
The extraordinary increase in Nvidia's market capitalization over the last 12 months has come to represent a Wall Street panic sparked by hope for the future of artificial intelligence.
Although the S&P 500, and Nasdaq have reached all-time highs thanks to Nvidia's surge, some investors are concerned that unfettered euphoria about artificial intelligence (AI) might vanish if indications of a slowdown in expenditure on the technology surface.
"We're all just trading in it; it's Nvidia's market," stated Interactive Brokers chief market strategist Steve Sosnick.
Based on LSEG statistics, Nvidia has emerged as the most traded business on Wall Street, with an average daily turnover of $50 billion, compared to about $10 billion for Apple, Microsoft, and Tesla. Currently, the chip manufacturer represents around 16% of total S&P 500 company trade.
While Microsoft's stock has increased by around 19% this year, Nvidia's price has nearly quadrupled as a result of demand for its top-tier chips exceeding supply.
Alphabet, the parent company of Google, Microsoft, and Meta Platforms are vying with each other to develop AI computing capabilities and incorporate the technology into their goods and services.
Since Nvidia's AI chips are so much sought after and are thought to be far better than those of its rivals, there is a shortage of them. In the eyes of many investors, Nvidia is the biggest beneficiary of the current surge in AI development.
"Nvidia has been getting a lot of positive attention and has been doing a lot of things very correctly, but a small misstep is likely to cause a major correction in the stock, and investors should be careful," said Oliver Pursche, senior vice president at Wealthspire Advisors in New York.
With Tuesday's increase, Nvidia's market capitalization increased by almost $110 billion, or the full value of Lockheed Martin, and its stock reached a record high.
In just nine months, the company's market worth increased from $1 trillion to $2 trillion in February, and it took slightly more than three months to reach $3 trillion in June.
With demand for its graphics chips far exceeding supply as businesses scramble to integrate AI applications, the company has routinely blown past Wall Street's high expectations for revenue and earnings since its explosive prediction nearly a year ago.
It was in May when Nvidia officials stated that demand for their Blackwell AI processors would outpace supply "well into next year."
Nvidia's stock has gained dramatically, but analyst estimates for its future profits have sharply increased faster, which has caused a decline in the firm's earnings value.
According to LSEG statistics, Nvidia was trading at 44 times forecast profits as of late, down from over 84 approximately a year ago.
Nvidia divided its shares 10 for 1 last week, making its highly valued stock more appealing to individual investors.
(Source:www.marketscreener.com)