Nvidia on Tuesday became the world's most valuable company, with a market capitalization of $3.34 trillion surpassing Microsoft and Apple. Driven by global AI frenzy and rising demand for AI processors, Nvidia is the first semiconductor firm ever to become the world's most expensive company.
Just a few months ago Nvidia's market capitalization was around $2.2 trillion and the company was behind Microsoft and Apple, but ahead of Saudi Aramco and Amazon in the Top 5 largest companies by market cap list. Then Nvidia announced its Q1 FY2024 financial results , posting revenue of $26.044 billion and earning a net income of $14.881 billion; Nvidia said it expected to earn $28 billion in the second quarter, greatly increasing investors's confidence and the company's market capitalization.
Nvidia's co-founder and chief executive Jensen Huang then took a tour around the world to discuss the prowess of AI, as well as Nvidia's next-generation Blackwell hardware, which further increased confidence. Nvidia's stock has gained over 160% in 2024 alone, adding more than $2 trillion to its market cap. Fast forward to June 18: Nvidia is now the world's most valuable company by market capitalization.
Nvidia's remarkable growth is fueled by the surging demand for its processors for AI and HPC, particularly for H100 and H200. And its bench is deep: The company already has its Blackwell family of products set to enter the market later this year and ramp up in 2024. With Blackwell, Nvidia will offer not only processors and servers but entire datacenters in essence, which is likely to further increase the company's earnings.
Analysts polled by Bloomberg believe that market capitalizations for the most successful technology companies could pass the $4 trillion mark, a truly stunning level. For now, all three contenders to be the first $4 trillion company — Nvidia, Microsoft, and Apple — are well positioned to take advantage of AI frenzy, albeit on different levels.
"We believe over the next year the race to $4 trillion market cap in tech will be front and center between Nvidia, Apple, and Microsoft," Daniel Ives, an analyst with Wedbush Securities wrote in a note published by Bloomberg .
