Nvidia on Friday dethroned Apple as the world’s most valuable company following a record rise in its stock price, driven by insatiable demand for its specialized artificial intelligence chips.
NVIDIA’s stock market value at one point reached $3.53 trillion, slightly more than Apple’s $3.52 trillion, according to LSEG data.
Nvidia rose 0.8% to end the day with a market capitalization of $3.47 trillion, while Apple shares rose 0.4%, valuing the iPhone maker at $3.52 trillion.
In June, Nvidia briefly became the world’s most valuable company, before being overtaken by Microsoft and Apple. The tech trio’s market capitalization has been closely contested in recent months.
Microsoft’s market capitalization was $3.18 trillion, and its stock price rose 0.8%.
The Silicon Valley chipmaker is a leading supplier of processors used in AI computing, making it the biggest winner in a race between Microsoft, Alphabet, Metaplatform and other heavyweights to monopolize the emerging technology. .
Nvidia, known as a designer of video game processors since the 1990s, has seen its stock rise about 18% so far in October after OpenAI, the company behind ChatGPT, announced a $6.6 billion funding round. .
Nvidia and other semiconductor stocks rose on Friday after data storage maker Western Digital reported a quarterly profit that beat analysts’ expectations, boosting optimism about data center demand.
“Demand for Nvidia chips remains strong as more companies now incorporate artificial intelligence into their daily operations,” said Russ Mould, investment director at AJ Bell.
“This is certainly in a sweet spot, and as long as we avoid a major U.S. recession, we think companies will continue to invest heavily in AI capabilities, creating a healthy tailwind for NVIDIA.”
Nvidia stock hit a record high on Tuesday, building on gains from last week when TSMC, the world’s largest contract chipmaker, posted a better-than-expected 54% quarterly profit growth as demand for AI chips soared. Ta.
Meanwhile, Apple is struggling with weak demand for smartphones. iPhone sales in China fell 0.3% in the third quarter, while sales of rival Huawei phones rose 42%.
Apple is scheduled to report quarterly results on Thursday, and analysts on average expect the company’s revenue to rise 5.55% from a year ago to $94.5 billion, according to LSEG data.
That compares with analysts’ predictions that Nvidia’s revenue would rise nearly 82% to $32.9 billion.
The stocks of Nvidia, Apple, and Microsoft have huge influence not only on the overall U.S. stock market, but also on the highly valuable technology sector, with the three companies accounting for about a fifth of the S&P 500 index. There is.
Optimism about AI’s outlook, expectations that the Federal Reserve will sharply lower U.S. interest rates, and most recently a strong start to earnings season pushed the benchmark S&P 500 index to record highs last week.
Nvidia’s big gains have helped make the stock more attractive to options traders, with the company’s options among the most traded on any given day in recent months, according to data from options analytics provider Trade Alert. It is one.
The stock has risen nearly 190% so far this year, as the boom in generative AI has led to a series of predicted crashes for Nvidia.
Rick Meckler, partner at Cherry Lane Investments, said: “The question is whether the revenue stream will be sustainable over time and driven by investor sentiment, rather than the ability to prove or disprove the hypothesis that AI has gone too far. Please.” A family-owned investment firm located in New Vernon, New Jersey.
“I think NVIDIA recognizes that its numbers could be very noteworthy in the near future.”
