Nvidia Becomes First Chipmaker to Reach $1tn Market Value Amid AI Revolution

Nvidia, the chipmaker at the forefront of the artificial intelligence (AI) revolution, has become the first in its industry to achieve a market value of $1tn.[0] The company's stock rose by more than 5% on Tuesday, taking its market capitalisation to over $1tn, before dipping below the threshold. Nvidia's shares have risen by almost 40% since 15 May, and by 188% so far this year.[1] The firm, which produces semiconductors and high-end graphics processing units, is also a leader in the discrete GPU field, making it a critical player in generative AI platforms like OpenAI's ChatGPT and Google's Bard.[2]

Nvidia's AI prospects have led to investor enthusiasm, with analysts increasing their price targets by almost 50% and Wall Street buy ratings rising to 84%. The company's Q1 earnings beat expectations by 16%, and it estimates Q2 revenue of $11bn. Nvidia's blockbuster earnings have given momentum to AI stocks, and other firms in the industry have seen their shares rise in sympathy. Nvidia now joins an elite club of companies worth over $1tn, including Apple, Microsoft, Saudi Aramco, Alphabet and Amazon.[3] However, some analysts have warned of a possible bubble, as the stock's value has risen sharply in a short period of time.

0. “Party Time: Brokers Just Made Major Increases To Their NVIDIA Corporation (NASDAQ:NVDA) Earnings Forecasts” Simply Wall St, 29 May. 2023, https://simplywall.st/stocks/us/semiconductors/nasdaq-nvda/nvidia/news/party-time-brokers-just-made-major-increases-to-their-nvidia

1. “Nvidia Breaks the $1 Trillion Market Cap Threshold” Tom's Hardware, 30 May. 2023, https://www.tomshardware.com/news/nvidia-breaks-dollar1-trillion-market-cap

2. “Nvidia crosses into $1 trillion market cap before giving back gains” CNBC, 30 May. 2023, https://www.cnbc.com/2023/05/30/nvidia-on-track-to-hit-1-trillion-market-cap-when-market-opens.html

3. “Nvidia’s AI gambit pays off as it hits trillion dollar valuation” Dexerto, 31 May. 2023, https://www.dexerto.com/tech/nvidias-ai-gambit-pays-off-as-it-approaches-trillion-dollar-valuation-2156457/

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