Nvidia has built a nearly $100 billion stock portfolio in just two years almost entirely by investing in other technology companies.
The AI chipmaker, led by CEO Jensen Huang, held $99 billion in stock investments as of July 26. latest earnings report.
That included approximately $48 billion in publicly traded stocks and other marketable securities, $48 billion in private company stocks and other non-tradable securities, and $3 billion in equity method investments.
The stock portfolio is up 14-fold in a year from about $7 billion last summer, and 45-fold from $2.2 billion two summers ago. The company also reported another $25 billion in equity investments obligations from July 26.
Nvidia’s quarterly portfolio release offered a glimpse of its public U.S. stock portfolio as of June 30. The company had a $30 billion stake in Intel, a Position of $21 billion in SpaceX, and investments in CoreWeave, Coherent, Synopsys and Nokia, each worth between $2 billion and $5 billion.
Nvidia’s massive increase in stock holdings has propelled the company into the ranks of the largest technology investors. It still trails that of Alphabet, which had a stock portfolio of $232 billion at the end of June $94 billion in SpaceX stock after the IPO in June.
Nvidia shares have skyrocketed from less than $15 at the start of 2023 to $228 at the end of Thursday. That fifteenfold increase in less than three years has catapulted its market cap to $5.5 trillion, making it the the world’s most valuable company.
The chip maker is the main facilitator of the AI boom by supplying the types of semiconductors needed to power the emerging technology, funding the buildout of its AI infrastructure, and investing in its AI peers.
An Nvidia spokesperson pointed Business Insider to Finance Department Colette Kress and said in the company’s latest earnings call that the ability of groundbreaking AI labs to improve their products, attract more users and generate more revenue was “limited by computing power,” so Nvidia was “needed to help drive this flywheel” and thus had invested nearly $50 billion in it.
In its latest earnings report, Nvidia said it is making equity investments to “expand our growth opportunities, cultivate our ecosystem and strengthen our competitive position.”
However, Michael Burry of ‘The Big Short’ fame has said that Nvidia is ‘overreacting’ in its attempts to achieve this juice its growth by financing and investing in customers of its chips.
Similarly, former ‘Shark Tank’ investor Mark Cuban has said that it is ‘really scary“how dependent the AI boom is on Nvidia “funding anyone and everyone.”
