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Nvidia’s shares jumped 2.9 per cent on Tuesday raising its market capitalisation (mcap) to $3.43 trillion, compared with Apple’s $3.38 trillion.
Nvidia, which accounts for 7 per cent of the weight of the S&P 500 Index, is responsible for about a quarter of the benchmark’s 21 per cent gain this year.
AI giant Nvidia has become the world’s largest company in the world, surpassing iPhone maker Apple, even as its shares jumped 2.9 per cent on Tuesday raising its market capitalisation (mcap) to $3.43 trillion. Apple’s mcap currently stands at $3.38 trillion.
Another tech giant Microsoft’s market valuation stands at $3.06 trillion.
Known since the 1990s as a designer of processors for videogames, Nvidia has been the biggest beneficiary of the AI boom of late. The artificially intelligence (AI) sector has gained a huge traction especially after the coronavirus pandemic, pushing Nvidia’s shares by 850 per cent since the end of 2022.
Nvidia, which accounts for 7 per cent of the weight of the S&P 500 Index, is responsible for about a quarter of the benchmark’s 21 per cent gain this year, according to Bloomberg.
“Over the past several quarters, it has felt like people basically care about inflation numbers, job numbers, and Nvidia numbers. Nvidia overtaking Apple in market cap not only conveys that it is the biggest beneficiary of the AI infrastructure cycle, but it suggests people expect the AI boom will continue,” said Fall Ainina, director of research at James Investment Research, according to Bloomberg.
Other tech companies are also now focussing on AI, with Apple recently newly launching AI iPhones. Microsoft, Amazon and Alphabet introduced their AI services along with cloud business. Meta, which owns Facebook and Instagram, also rolled out AI features and ad targeting.
“The implication of AI is extraordinarily large, and these big tech companies are investing hundreds of billions into it, with Nvidia benefiting the most. Overall there continues to be a good picture for its prospects,” said James Investment’s Ainina, according to Bloomberg.
Last week, Apple’s results underlined concerns about its revenue growth, along with weakness in China. Nvidia will report later this month.
For the September 2024 quarter, NVIDIA had reported a revenue of $30.0 billion, up 15 per cent from the previous quarter and up 122 per cent from a year ago. It also exceeded analysts’ expectations.
For the quarter, GAAP earnings per diluted share was $0.67, up 12% from the previous quarter and up 168% from a year ago. Non-GAAP earnings per diluted share was $0.68, up 11% from the previous quarter and up 152% from a year ago.
Following the results, its founder and CEO Jensen Huang said, “NVIDIA achieved record revenues as global data centers are in full throttle to modernise the entire computing stack with accelerated computing and generative AI.”
