Nvidia, the prominent AI chipmaker, has briefly surpassed Amazon in market value, propelling the company to become the fourth most valuable company in the United States, according to recent reports. This significant achievement for Nvidia comes as its stock price reached a peak of $734.96, resulting in a market value of $1.82 trillion. Amazon, on the other hand, trailed closely behind with a market value of $1.81 trillion, falling just short of Alphabet, the parent company of Google, which boasts a market value of $1.87 trillion.
The temporary overtaking of Amazon propelled Nvidia to the fourth spot amongst US-listed companies in terms of market value. The top two positions are occupied by Apple and Microsoft, valued at $2.89 trillion and $3.09 trillion respectively.
Forbes reports that Nvidia’s profits before interest, taxes, depreciation, and amortization (EBITDA) witnessed a staggering increase of over 500% in the most recent quarter compared to the previous year. This substantial growth highlights Nvidia’s continuous rise in value and profitability, largely attributed to the remarkable growth of its artificial intelligence division. Nvidia’s earnings growth of over 20% surpasses that of both Amazon and Alphabet.
Despite Nvidia’s last quarter’s profit of $9.2 billion falling significantly below the earnings of Apple and Microsoft, which exceeded $22 billion during the same period, analysts predict that Nvidia’s financials will soon narrow the gap. While Nvidia’s gross revenue and profits may not be as impressive as its trillion-dollar counterparts, the company remains a favorite among Wall Street analysts, particularly at Bank of America and Goldman Sachs.
With a remarkable surge of 223% in the past 12 months, Nvidia’s stock stands out as the highest performing stock among the so-called Magnificent Seven due to the company’s strong AI demand forecast. The stock of Meta Platforms, formerly known as Facebook, takes second place with a 163% increase.
Forbes estimates that a $1,000 investment in Nvidia made ten years ago would be worth approximately $175,000 today, indicating a gain of 17,000%. Nvidia’s stock has produced the highest return of any S&P 500 stock, nearly doubling that of rival chipmaker Advanced Micro Devices (AMD), which secures the second position in the AI chipmaking industry.
In a similar vein, Arm Holdings, a British tech semiconductor company focused on AI chips, witnessed a surge of over 40% in its stocks on Monday, as reported by Reuters. This increase follows another surge on the previous Friday, with closing prices 42% higher at $164. As of the most recent trading day, the stock was up 21% at $139.65. Arm’s shares have risen over 80% since surpassing Wall Street’s expectations in their quarterly outlook last Wednesday, placing the British tech company among the favored entities in the AI industry.
In conclusion, Nvidia’s momentary surpassing of Amazon in market value has cemented its position as the fourth most valuable US company. With their AI division driving substantial growth, Nvidia continues to demonstrate rising value and profitability. The surge in stock performance further establishes Nvidia as a top choice among investors, while rival companies like Arm Holdings also experience notable success in the AI chipmaking sector.
