The company is worth more than $1 trillion on the stock market.
(Photo: Reuters)
new York Nvidia’s stock market value broke through the one trillion dollar mark on Tuesday thanks to growing chip demand due to the artificial intelligence (AI) boom. This made the group the ninth company and the first chip manufacturer to be admitted to this exclusive club.
Nvidia shares rose nearly 7 percent to a record high of $415.50 as Wall Street opened. As a result, the market capitalization grew to almost $1.026 trillion.
The other US companies with comparable or higher stock market values are the online retailer Amazon, the iPhone manufacturer Apple, the software company Microsoft and the Google mother Alphabet. From abroad, the Saudi Arabian oil producer Saudi Aramco also plays in this league.
Nvidia: New supercomputer drives the share price
“With Nvidia’s valuation above its long-term average, there is increasing pressure to deliver sustained high growth,” said Hargreaves Landsdown analyst Susannah Streeter. Therefore, price turbulence must be expected. Thomas Hayes, manager at wealth manager Great Hill, also warned of possible profit-taking. Investors are not yet sure if the current AI trend is real.
Nvidia published an optimistic outlook last week, to which numerous analysts responded by raising their forecasts.
The shares received additional momentum from the company’s announcement that it would build one of the world’s fastest supercomputers for AI applications in Israel. “Israel-1” will achieve a computing power of up to eight exaflops. An exaflop is equivalent to a trillion – a one followed by 18 zeros – calculations per second. “Generative AI is everywhere these days,” Nvidia executive Gilad Shainer said in an interview with Reuters.
Generative AI like ChatGPT requires a lot of computing power to create text, images or videos using just a few keywords. Graphics chips are particularly well suited for this because they are designed to carry out numerous calculations in parallel.
Year-to-date, Nvidia stocks are already up nearly 180 percent, more than four times the Philadelphia semiconductor index. It was only in the first half of 2001 that Nvidia papers went up even more steeply. Investors also grabbed their rivals AMD, Marvell and Intel on Tuesday. These shares each 2.5 percent.
More: AI boom drives chip maker Nvidia – market value increases by more than 180 billion dollars