Chipmaker Nvidia became the first public company in history to scale a $4tn market value on Wednesday as its stock price continues a years-long stratospheric rise.
Shares of the top chip designer rose roughly 2.4% to $164, benefiting from the ongoing surge in demand for artificial intelligence technologies. Nvidia’s chips and associated software are considered world leaders for building artificial intelligence products.
Nvidia achieved a $1tn market value for the first time back in June 2023 and the surge continued unabated with its market value – the total value of its shares – more than tripling in about a year, faster than Apple and Microsoft, the only other US firms with a market value of more than $3tn. Apple was the first company to reach a valuation of $3tn, back in 2022.
Microsoft is the second-biggest US company, with a market value of about $3.75tn. Nvidia’s value is equivalent to 7.3% of the entire S&P 500, Wall Street’s benchmark share index. Apple and Microsoft, account for about 7% and 6%, respectively.
Nvidia has rebounded about 74% from its April lows, when global markets were jolted by Donald Trump’s tariff volley. US export controls forbid Nvidia from selling its most advanced chips to China, a restriction the company has pushed back on.
However, optimism around trade partners reaching deals with the US have lifted stocks of late, with the S&P 500 hitting an all-time high.
Daniel Ives, tech analyst at Wedbush, predicted that more big tech giants will come to join Nvidia in the $4tn market club. “The poster children for the AI revolution are led by Nvidia and Microsoft as both are foundational pieces of building on the biggest tech trend we have seen in our 25 years covering tech stocks on the Street,” he said.
Microsoft will hit $4tn “this summer”, Ives said, “and then over the next 18 months the focus will be on the $5tn … as this tech bull market is still early being led by the AI revolution.”
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Reuters contributed reporting