Nvidia Mcap hits $3.53 trillion on AI frenzy, dethrones Apple to become world’s most valuable company
- Nvidia shares were last up 2.2 per cent, with a market value of $3.52 trillion, while Apple's shares rose 0.9 per cent, valuing the iPhone maker at $3.54 trillion.
Nvidia dethroned Apple as the world's most valuable company on Friday, October 25, following a record-setting stock rally powered by frenzied demand for its specialized artificial intelligence (AI) chips. According to Reuters, Nvidia's stock market value briefly touched $3.53 trillion, slightly above Apple's $3.52 trillion.
Shares of the chip-making giant rose around three per cent, with a market value of $3.52 trillion, while Apple's shares rose 0.9 per cent, valuing the iPhone maker at $3.54 trillion. In June, Nvidia briefly became the world's most valuable company before Microsoft and Apple overtook it. The tech trio's market capitalizations have been neck-and-neck for several months.
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Microsoft's market value stood at $3.20 trillion, and its stock was up 1.3 per cent. The Silicon Valley chipmaker is the dominant supplier of processors used in AI computing, and it has become the biggest winner in a race between Microsoft, Alphabet, Meta Platforms, and other heavyweights to dominate the emerging technology.
Known since the 1990s as a designer of video game processors, Nvidia's stock has risen about 18 per cent in October. A string of gains came after OpenAI, the company behind ChatGPT, announced a funding round of $6.6 billion. Nvidia and other semiconductor stocks rose after data storage maker Western Digital reported quarterly profits that beat estimates, buoying optimism about data centre demand.
Nvidia vs Apple vs Microsoft
Nvidia's shares hit a record high on Tuesday, building on a rally from last week when TSMC, the world's largest contract chipmaker, posted a forecast-beating 54 per cent jump in quarterly profit driven by soaring demand for chips used in AI.
According to news agency Reuters, Apple is struggling with tepid smartphone demand. iPhone sales in China slipped 0.3 per cent in the third quarter, while sales of phones made by rival Huawei surged 42 per cent.
With Apple set to report its quarterly results next week, analysts, on average, see its revenue climbing 5.55 per cent year over year to $94.5 billion. That compares with analysts' projections for Nvidia, which showed nearly 82 per cent revenue growth to $32.9 billion.
Shares of Nvidia, Apple, and Microsoft have an outsized influence on the richly valued technology sector and the broader US stock market, accounting for about a fifth of the S&P 500 index's weight. The stocks are heavyweights and push the indices higher on a rapid surge in share prices.
Optimism about the prospects for AI, expectations that the US Federal Reserve will considerably bring down US interest rates, and, most recently, an upbeat start to the earnings season helped lift the benchmark S&P 500 to an all-time high last week.
Nvidia's massive gains have helped boost the stock's appeal for option traders. The company's options are among the most traded on any given day in recent months, according to data from options analytics provider Trade Alert. The stock has surged nearly 190 per cent this year as the boom in generative AI led to a series of blowout forecasts from Nvidia.
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