Nvidia Achieves Historic $4 Trillion Valuation as First Public Company Amid AI Boom

Nvidia, a prominent chipmaker from Silicon Valley, has become the first publicly traded company to reach a market valuation of $4 trillion. This milestone highlights the intense investor interest in artificial intelligence, driven by Nvidia's leading processors. AI is seen as a major technological shift, comparable to the impact of the first iPhone introduced by Apple co-founder Steve Jobs 18 years ago.

AI's influence is reshaping the tech industry, with Nvidia now valued at $900 billion more than Apple. Apple's success with the iPhone led it to become the first company to reach $1 trillion, $2 trillion, and eventually $3 trillion in market value. However, Apple's efforts to integrate more AI into its products have faced challenges. The company recently acknowledged that its AI ambitions will take until at least next year to materialise, raising speculation about potential acquisitions of AI start-ups.

Nvidia's Market Surge and Industry Impact

Meanwhile, former Apple designer Jony Ive has teamed up with OpenAI to develop a wearable AI device that could rival the iPhone. Nvidia is striving to meet the high demand for its specialised chips, which power energy-intensive data centres essential for AI. Tech giants like Microsoft, Amazon, Alphabet (Google's parent company), and Meta Platforms (Facebook's parent company) are also heavily investing in AI, collectively allocating around $325 billion this year. A significant portion of this investment is expected to benefit Nvidia.

The soaring demand for Nvidia's chips has driven its stock price up tenfold since early 2023. This surge increased its market value from approximately $400 billion to $4 trillion. Although Nvidia's market value briefly dipped below $4 trillion during afternoon trading on Wednesday, its shares remained around $163.

Challenges and Triumphs

Nvidia's rapid ascent has earned its founder and CEO, Jensen Huang, the title of "the godfather" of AI. His insights into AI's future captivate audiences worldwide. Huang's growing fame is matched by his increasing wealth, now estimated at $142 billion.

In early April, Nvidia faced a setback when President Donald Trump announced sweeping tariffs that led to a stock market selloff affecting the tech sector. Nvidia's stock price fell below $87 at its lowest point. However, the company quickly rebounded and reported an impressive quarter in late May, with an $18.8 billion profit despite a $4.5 billion loss due to US government restrictions on selling certain chips to China.

The Santa Clara-based company is set to release its next quarterly report on August 27th.

With inputs from PTI