Technology

Nvidia hits $3 trillion market cap on back of AI boom

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Nvidia’s CEO Jensen Huang delivers his keystone speech ahead of Computex 2024 in Taipei on June 2, 2024. 
Sam Yeh | AFP | Getty Images

Nvidia shares closed up 5% to $1,224.40 on Wednesday, giving the company a market cap above $3 trillion for the first time as investors continue to clamor for a piece of the company at the heart of the boom in generative artificial intelligence.

Nvidia also passed Apple to become the second-largest public company behind Microsoft.

Nvidia’s milestone is the latest stunning mark in a run that has seen the stock soar more than 3,224% over the past five years. The company will split its stock 100-for-1 later this month.

Apple was the first U.S. company to reach a $3 trillion market cap during intraday trading in January 2022. Microsoft hit $3 trillion in market value in January 2024. Nvidia, which was founded in 1993, passed the $2 trillion valuation in February, and it only took roughly three months from there for it to pass $3 trillion.

In May, Nvidia reported first-quarter earnings that showed demand for the company’s pricey and powerful graphics processing units, or GPUs, showed no sign of a slowdown. Nvidia reported overall sales of $26 billion, more than triple what it generated a year ago. Nvidia also beat Wall Street expectations for sales and earnings and said it would report revenue of about $28 billion in the current quarter.

Nvidia’s surge in recent years has been powered by the tech industry’s need for its chips, which are used to develop and deploy big AI models such as the one at the heart of OpenAI’s ChatGPT.

Companies such as GoogleMicrosoftMetaAmazon and OpenAI are buying billions of dollars worth of Nvidia’s GPUs.

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