Nvidia Hits $4 Trillion Market Cap First in History
▼ Summary
– Nvidia became the first public company to reach a $4 trillion market cap, with shares rising 2.8% to $164.42 during trading.
– The company’s rapid growth saw it surpass $2 trillion in February 2024 and $3 trillion in June, driven by the AI boom.
– Nvidia’s chips power data centers for major tech firms like Amazon, Google, and Microsoft, fueling AI and cloud computing growth.
– The AI infrastructure market is projected to exceed $200 billion by 2028, with spending on AI hardware surging 97% annually in early 2024.
– Nvidia reported a $44.1 billion Q1 revenue, up 69% year-on-year, despite a $4.5 billion loss due to US export controls on China.
Nvidia has made history by becoming the first company ever to reach a staggering $4 trillion market valuation, cementing its position as the world’s most valuable corporation. The chipmaker’s shares climbed to $164.42 during Wednesday’s trading session before closing at $162.88, marking an 18% surge since the start of the year. This milestone follows rapid growth, Nvidia crossed the $2 trillion threshold in February and hit $3 trillion just four months later in June.
Analysts attribute this unprecedented rise to Nvidia’s dominance in the AI revolution, which has fueled record-breaking performances across tech stocks. Wedbush Securities’ Dan Ives called it a “historic moment for the U.S. tech sector,” emphasizing how artificial intelligence has reshaped market dynamics. The S&P 500, where Nvidia holds a 7.3% weighting, also reached new highs, surpassing 6,200 points in late June.
While other tech giants like Microsoft, Apple, and Alphabet have benefited from AI investments, Nvidia stands out as the primary enabler of this transformation. Its high-performance chips power data centers for major cloud providers and AI developers, including OpenAI, Amazon, and Google. The company reported a staggering $18.8 billion profit in Q1 2024, with revenue jumping 69% year-over-year to $44.1 billion.
The AI infrastructure market is projected to exceed $200 billion by 2028, driven by surging demand for computing power. In the first half of 2024 alone, corporate spending on AI-related hardware nearly doubled. Nvidia has further expanded its influence through strategic partnerships, including collaborations with Oracle and Abu Dhabi’s G42 to accelerate AI development in the region.
However, challenges remain. Export restrictions on China cost Nvidia $4.5 billion, with CEO Jensen Huang describing the $50 billion Chinese market as effectively closed to U.S. firms. Despite this setback, the company continues to push forward, with Q2 earnings expected next month.
As AI becomes as fundamental as electricity or the internet, Nvidia’s role as the backbone of this technological shift ensures its position at the forefront of global innovation. With no signs of slowing down, the company’s trajectory could redefine the future of computing and enterprise technology.
