NAIROBI, Kenya- In a stunning market surge, Nvidia has overtaken Apple to become the world’s second most valuable company, with its market valuation hitting the $3 trillion mark.
This rally underscores a major shift in Silicon Valley, positioning Nvidia as a formidable leader in the tech industry, driven by its advancements in artificial intelligence.
Nvidia’s Meteoric Rise
Last week, shares of Nvidia rose to record highs, bringing its market value to an impressive $3.01 trillion. Meanwhile, Apple’s market capitalization stood at $3.00 trillion
The demand for Nvidia’s high-performance processors is soaring, outstripping supply as tech giants like Microsoft, Meta Platforms, and Alphabet race to enhance their AI capabilities.
This surge reflects a broader optimism in the market about AI’s transformative potential, lifting chip stocks broadly on Wednesday.
AI Demand Fuels Growth
Nvidia’s recent quarterly results and forward guidance exceeded Wall Street expectations, fueling further optimism about sustained AI-related spending on semiconductors.
The company’s announcement of a new series of AI chips to succeed its current Blackwell chips has also bolstered investor confidence.
According to a note from BofA, Nvidia maintains a significant lead over its rivals AMD and Intel, with a multi-year advantage in performance, pipeline, incumbency, scale, and developer support.
Nvidia CEO Jensen Huang has been at the center of this wave of enthusiasm, receiving extensive media coverage in Taiwan and drawing crowds at the Computex tech trade fair in Taipei.
Challenges for Competitors
While Nvidia rides high on AI-driven optimism, Apple faces challenges with weak demand for iPhones and stiff competition in China, the world’s largest smartphone market.
Some investors view Apple as lagging behind other tech giants in integrating AI features into their products and services.
This perception has contributed to Nvidia’s ascension in market valuation, as investors look for leaders in AI innovation.
Microsoft remains the world’s most valuable company with a market value of $3.14 trillion, reflecting its own robust performance and strategic investments in AI.
The new trend is investments has seen companies allocating their resources to developments in AI so as to secure their positions in the market.
