Nvidia recently claimed the title of the world’s most valuable company, surpassing Apple following a record-breaking surge in its stock.
This spike reflects the rapid increase in demand for Nvidia’s specialized chips, crucial for artificial intelligence technology.
Nvidia’s market value briefly reached $3.53 trillion, just ahead of Apple’s $3.52 trillion, according to market data, though it settled at $3.47 trillion by the day’s end. Apple’s stock also rose slightly, bringing its value to $3.52 trillion, with Microsoft closely following at $3.18 trillion.
The competition among these tech giants has been tight, with Nvidia, Apple and Microsoft jockeying for top positions over recent months. Nvidia has emerged as a key player in this race, as more companies incorporate AI technology into daily operations.
Microsoft, Alphabet, Meta and others are all striving to dominate the AI field, but Nvidia’s role as the main supplier of AI chips has given it a competitive edge.
Rapid growth fueled by AI
Originally known for designing video game processors in the 1990s, Nvidia has seen an impressive stock increase, rising around 18% in October. This growth aligns with OpenAI’s recent $6.6 billion funding announcement, which boosted Nvidia and other chip companies.
The American multinational corporation and technology company headquartered in Santa Clara, California saw further gains on Friday after Western Digital, a data storage company, reported better-than-expected profits, raising optimism for the data center sector, where Nvidia’s AI processors play a key role.
Investment director Russ Mould of AJ Bell commented on the high demand for Nvidia’s chips, noting that AI is becoming central to daily operations for many companies. He emphasized that Nvidia is in a strong position, with businesses expected to continue investing in AI technology, barring any major economic downturn in the U.S.
Stock surge and market influence
Nvidia’s recent rally continued fueled by strong quarterly results from TSMC (Taiwan Semiconductor Manufacturing Company Limited), the world’s largest contract chipmaker, which reported a 54% profit jump driven by increased demand for AI chips.
Nvidia’s ongoing stock growth has made it a popular choice among options traders, with its options ranking among the most traded in recent months. The stock has surged nearly 190% this year, reflecting the growing enthusiasm around AI’s potential.
In contrast, Apple is seeing a slowdown in smartphone demand, with iPhone sales in China slipping by 0.3% in the third quarter while Huawei saw a 42% increase.
Apple is set to release its quarterly earnings on Thursday (October 31), and analysts expect a 5.55% revenue growth to $94.5 billion. By comparison, Nvidia’s revenue growth is projected at nearly 82%, reaching $32.9 billion.