Nvidia Becomes World’s Most Valuable Company Amid AI Boom

Source: Reuters

Nvidia (NVDA.O) has become the world’s most valuable company after a significant rise in its share prices, driven by the increasing influence of artificial intelligence on the global economy. On Tuesday, Nvidia’s shares increased by 3.5%, reaching a market value of approximately $3.34 trillion. This surge pushed Nvidia ahead of tech giants Microsoft (MSFT.O) and Apple (AAPL.O).

The remarkable increase in Nvidia’s market value is attributed to the high demand for its AI-focused chips. Nvidia’s shares have surged more than 170% this year and approximately 1,100% since their low in October 2022. Strong earnings and growing investor interest in AI have fueled Nvidia’s impressive stock rally. It took Nvidia only 96 days to grow its market value from $2 trillion to $3 trillion, a record pace compared to Microsoft and Apple, according to Bespoke Investment Group.

Since 1925, only 11 U.S. companies have reached the top spot in market value, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices. The performance of these companies has varied over time. Microsoft struggled during the early 2000s after reaching the top position in the late 1990s but rebounded in the last decade. Exxon Mobil (XOM.N) held the top spot in the 2000s but saw its shares decline due to falling oil prices. Cisco (CSCO.O) serves as a cautionary example, with its shares peaking at over $80 in March 2000 during the dotcom boom before experiencing a significant downturn.

Nvidia’s rapid ascent highlights the growing importance of artificial intelligence in shaping the future of the global economy, solidifying its position as a key player in the tech industry.