Nvidia becomes first chipmaker to hit $1 trillion valuation as company capitalizes on AI boom
Nvidia is the first chip maker to reach a value of $1 trillion (£807 billion).
Shares have skyrocketed as the company benefits from the rise of artificial intelligence (AI).
Nvidia said revenue in the three months to July would reach £9 billion, beating Wall Street estimates.
Nvidia shares traded for $406 yesterday, putting the company in the elite club of Silicon Valley stocks to reach a market cap of more than $1 trillion
The California company posted one of the largest one-day stock market gains ever in the history of the US company last week – adding more than £150bn to its market capitalization in Thursday trading alone.
The profit came close to the total value of Shell, the second largest company in the UK stock market.
And the wave has continued this week. Shares traded for $406 yesterday, putting Nvidia in the elite club of Silicon Valley stocks to reach a market cap of more than $1 trillion.
This group includes tech giants Amazon, Apple, Google owner Alphabet and Microsoft, as well as Saudi Aramco. Facebook owner Meta and Tesla joined the trillion-dollar club in 2021, but later fell out due to a broader technology sell-off.
Nvidia’s stock is up more than 175 percent this year as analysts back the company to grow even bigger thanks to intensive AI investments.
Nvidia has played a key role in the growing popularity of AI, supplying chips to Microsoft to develop the technology.
Chief executive Jensen Huang said it was in the right place at the right time as AI and ChatGPT took off.
The second largest chipmaker in the world – Taiwan Semiconductor Manufacturing – is valued at around £431 billion.
But Nvidia’s recent success stands in stark contrast to its bumpy ride in 2022. It’s been battered by declining demand for its gaming chips and the failed attempt to buy UK-based chip designer Arm from Japan’s SoftBank.