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Nvidia surpasses Apple and its market capitalization exceeds US$3 trillion
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Nvidia’s market value surpassed $3 billion and overtook Apple on Wednesday as the second most valuable company in the world, after a year of incredible growth driven by demand for its artificial intelligence chips.
The U.S. chip designer’s shares rose about 5 percent to push its market capitalization ahead of Litter for the first time – ending the day at US$3.01 trillion, according to Bloomberg data, slightly ahead of Apple’s US$3 trillion. The iPhone maker lost its place as the most valuable listed company to Microsoft this year.
Investors flocked from Nvidia stocks as technology groups like Google, Microsoft and Meta spend billions of dollars on their chips, with no indication that their spending spree will slow down in the near future.
Nvidia’s data center chips power AI models that Chief Executive Jensen Huang says will fuel a new “industrial revolution,” transforming global businesses with productivity-boosting capabilities.
The company delivered another blockbuster earnings report in May, with a 262% annual increase in revenue, largely thanks to sales of the current generation of “Hopper” chips. It also announced a 10-for-one stock split, which will take effect on June 7.
Nvidia alone has generated more than a third of this year’s gains in Wall Street’s benchmark S&P 500 index, according to Bloomberg data, raising fears in some quarters of an unsustainable bubble. The S&P 500 rose 1.2% on Wednesday and is up 12.3% year to date.
Still, Nvidia’s bumper profits and repeated forecast updates mean the company’s valuation isn’t at an all-time high when measured as a proportion of its historical or expected profits.
On Wednesday, it was valued at about 42 times expected earnings over the next 12 months. That’s about 23 times forward earnings at the start of the year and is well above Apple’s 29x — although it’s below the peak reached during the height of the first wave of AI euphoria last year.
“The advantage they have is that they are one of the few companies that can actually prove AI revenues,” said Stuart Kaiser, head of U.S. equity trading strategy at Citigroup. “The higher [the stock] The further you get into this revenue cycle, the more the risks increase, but so far it looks pretty clean.”
Despite moves by rivals like AMD and Intel to capture some of Nvidia’s market share, Nvidia remains the undisputed leader in the global technology race to deliver the most advanced hardware for increasingly demanding AI workloads, as well such as software tools for building AI applications.
Huang promised a “one-year cadence” of new chips and unveiled Nvidia’s “Blackwell” products in March. Huang said they would generate “a lot” of revenue this year – sooner than many analysts predicted.
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And in a surprise move at Taiwan’s Computex conference over the weekend, Huang also teased the next generation of “Rubin” processorswhich will begin to be commercialized in 2026.
Apple will hold its annual Worldwide Developers Conference on June 10, where Chief Executive Tim Cook is expected to outline the company’s own plan for integrating generative AI capabilities into its products.
Until now, Apple has been left out of the market excitement around generative AI that has boosted its rivals’ shares. Sales of its iPhones have also fallen year over year, in part due to resurgent competition in China.
But Cook said he was “optimistic” about its prospects in the AI space, and Apple shares also recovered from a drop earlier in the year with the announcement of a larger-than-expected share buyback worth $110,000. million dollars in May.
Video: The race for semiconductor supremacy | FT Film
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