Active Stocks
Thu Sep 21 2023 15:54:10
  1. Tata Steel share price
  2. 127.8 -0.39%
  1. HDFC Bank share price
  2. 1,553.6 -0.66%
  1. NTPC share price
  2. 238.95 -1.1%
  1. Power Grid Corporation Of India share price
  2. 201.8 -1.42%
  1. ITC share price
  2. 447.4 -1.24%
Business News/ Markets / Stock Markets/  Nvidia becomes first US chipmaker valued at over $1 trillion; joins exclusive FAANG group

Nvidia Corp on May 30 breached $1 trillion in market capitalization, making it the first US chipmaker to join the trillion-dollar club. The gaming and AI chip company, whose shares rose 3.8 per cent in trading before the bell on Tuesday, was valued at $1.03 trillion. AI took center stage after Nvidia stunned investors by reporting a quarterly profit of more than $2 billion and revenue of $7 billion, both exceeding Wall Street expectations.

Meta Platforms Inc , valued at about $670 billion as of last close, clinched the trillion-dollar market capitalization milestone in 2021, while Apple Inc, Alphabet Inc, Microsoft Corp and Inc are the other U.S. companies that are part of the club.

Wall Street analysts called Nvidia's forecast "unfathomable" and "cosmological", hiking their price targets in droves. The highest price target valued the company at about $1.6 trillion, on par with Google-parent Alphabet.

Also Read: Nvidia Mcap at $1 trillion: Top 5 things to know about the US chipmaker

Nvidia's chief executive officer Jensen Huang unveiled a new batch of products and services tied to AI, looking to further capitalise on the frenzy that resulted his wealth to soar by almost $7 billion billion last week to hit nearly $35 billion.

"Given the valuation is well above the long-term average, there will be significant pressure to deliver high growth on a consistent basis ... there could be volatility in its share price to come," Susannah Streeter, head of money and markets at Hargreaves Lansdown, said.

Nvidia's shares rose about 25 per cent last week sparking a rally in AI-related stocks and boosted other chipmakers, helping the Philadelphia SE Semiconductor index close on Friday at its highest in over a year.

OpenAI-owned ChatGPT's rapid success has prompted tech giants such as Alphabet and Microsoft to make the most of generative AI, which can engage in human-like conversation and craft everything from jokes to poetry.

Nvidia was co-founded in 1993 by Huang. It proved more successful than its peers at developing chips that turn computer code into the realistic images that computer gamers love, and rode out a wave of consolidation that saw its rivals acquired, bankrupted or merged into larger companies.

Under Huang, the company then pushed its technology into new markets, such as data center servers and artificial intelligence processing — a move that’s proving prescient today. In less than a decade, Nvidia’s data center business has grown from $300 million in annual revenue to $15 billion. The chipmaker has won orders to equip giant computing factories by successfully arguing that graphics chips can handle AI workloads better than more standard processors.


With inputs from Reuters, Bloomberg

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Updated: 30 May 2023, 07:12 PM IST
Next Story
Recommended For You

Get the best recommendations on Stocks, Mutual Funds and more based on your Risk profile!

Let’s get started
Switch to the Mint app for fast and personalized news - Get App