$3 trillion: Nvidia beats Apple to be 2nd most valued company

Santa Clara (TIP)- Nvidia Corporation, the world’s most valuable semiconductor company, has now become the first computer-chip firm to hit a $3 trillion market capitalisation, as per a Bloomberg report. The Santa Clara, California-based company’s shares have surged roughly 147 per cent this year, adding about $1.8 trillion due to the increasing demand for its chips that power artificial intelligence (AI) tasks.
On June 5 (US local time), shares rose by 5.2 per cent to close at a record $1,224.40, pushing the chip maker’s market value above $3 trillion, surpassing Apple Inc. in the process.
The last time Nvidia’s value exceeded Apple’s was in 2002, five years before the first iPhone’s release. Back then, both companies were valued at less than $10 billion each.
Future Plans and Generative AI
Nvidia shows no signs of slowing down. Chief Executive Officer Jensen Huang announced that the company plans to upgrade its AI accelerators annually. Wednesday’s stock surge increased Huang’s wealth by more than $5 billion, bringing his total to $107.4 billion, according to the Bloomberg Billionaires Index.
Huang described the rise of generative AI as a new industrial revolution, expecting Nvidia to play a significant role as technology shifts to personal computers. During a keynote address at National Taiwan University, he highlighted the company’s pivotal role in this transformation.
Senior equity analyst at CFRA Research, Angelo Zino, told Bloomberg he sees this development as just the beginning, citing improved visibility and greater momentum in GPU, CPU, and networking as drivers for consensus estimate upside.
Impact on the Tech Industry
Nvidia has benefited immensely from a surge in AI spending, propelling the company into a race to become the world’s most valuable company. Although it still trails Microsoft Corp. by market value, Wall Street analysts believe it is only a matter of time before Nvidia overtakes it.
Conversely, Apple has faced challenges this year, with its shares pressured by concerns over declining iPhone demand in China and a fine from the European Union. Despite this, Apple shares have recently turned positive for 2024 as investor sentiment slowly improves.

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