Nvidia Touches $1 Trillion Market Cap As Chipmaker Rides AI Wave

By Yahoo News
Posted on 05/30/23 | News Source: Yahoo Finance

Nvidia (NVDA) became the first chipmaker to ever hit a $1 trillion market valuation on Tuesday. Nvidia's stock rose more than 5% during the session, temporarily crossing over the threshold before giving back some of those gains in the afternoon.

The Santa Clara, Calif.-based chipmaker is now the ninth public company to ever hit the $1 trillion level, joining the ranks of tech giants such as Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), and Apple (AAPL).

Nvidia shares have seen a stunning rally this year — up more than 165% since the start of 2023. The chipmaker is at the center of an AI craze thanks to its high-powered graphics cards and server products.

On Monday, Nvidia took the wraps off a slew of new AI-centric products, including a new high-powered supercomputer and a platform that will put generative AI to work in video game development.

Shares skyrocketed more than 26% last Thursday following Nvidia's better-than-expected quarterly results and guidance.

“There’s a war going on out there in AI, and Nvidia today is the only arms dealer out there. So as a result we’re seeing this huge jump in revenues,” Raymond James managing director Srini Pajjuri recently said in a note to investors.

The company says it expects revenue of $11 billion, plus or minus 2% for the second quarter. Wall Street was looking for $7.2 billion.

“We thought if they beat the guidance by about 5%, that’s good enough for the stock to stay where it is. But they’re beating [the] guidance consensus by 50%,” said Pajjuri.