Nvidia nears becoming a member of the exclusive trillion-dollar club of Alphabet, Amazon, Apple, and Microsoft
While the exclusive trillion-dollar tech club has been shrinking over the past years due to the ongoing economic slowdown sparked by geo-political risks and high-interest rates, the club is about to welcome its new member: Nvidia.
In a remarkable surge on Thursday, Nvidia appears to be on the verge of securing a coveted position in the exclusive trillion-dollar market cap companies that now include only Apple, Microsoft, Alphabet, and Amazon after Tesla and Meta lost their membership late last year.
Almost overnight, the chipmaker experienced a staggering 26% surge in its share value, propelling its market worth to nearly $1 trillion at approximately $950 billion, according to FactSet. This remarkable ascent represents a significant increase from its previous closing market value of $755 billion on Wednesday.
Nvidia’s impressive performance is not limited to its revenue of $7.2 billion in the first quarter alone. The company’s projections for the upcoming quarter indicate an estimated revenue of approximately $11 billion, surpassing Wall Street’s expectations by over 50%. This incredibly optimistic outlook sparked a remarkable 26% surge in Nvidia’s stock when the market opened on Thursday morning, adding a staggering $170 billion to its market value.
According to Bloomberg data, this represents one of the largest single-day gains ever recorded for a US stock. As a result, Nvidia’s market capitalization now exceeds $950 billion. The rally also had a positive impact on other players in the chip industry, such as Taiwan’s TSMC and Japan’s Advantest.
In a note on Thursday, Needham analyst Rajvindra Gill said:
“Back in late 2021, we began publishing work suggesting Nvidia would become the first semiconductor company with a trillion-dollar market cap. While there was some peaks and valleys in the interim years, we believe Nvidia is in a position to achieve that valuation over time.”
You may wonder how Nvidia has achieved such remarkable growth. Thanks to the popularity of ChatGPT and the big demand for new chips to power generative AI tools. Nvidia is also the leader in the development of chip technology that holds the potential to either guide us toward salvation or lead us to eternal peril: artificial intelligence.
While we have a long way to go before computer programs resemble Steven Spielberg’s depiction of a futuristic Pinocchio with the likeness of Haley Joel Osment, Nvidia has emerged as a leading company in constructing and advancing AI generative systems.
Founded in 1993 by CEO Jensen Huang, Chris Malachowsky, and Curtis Priem, Nvidia specializes in designing and manufacturing graphics processing units (GPUs) for gaming, artificial intelligence, and other applications. It has achieved significant growth and recognition for its advancements in AI and its contributions to the gaming industry.
Meanwhile, the elite trillion-dollar big tech club known as MAMATA used to be worth a combined market value of $10 trillion lost over $1 trillion of its value late last year in just three trading days of market rout.