Nvidia hits $4 trillion in valuation, the first for any public company

AI chip manufacturer Nvidia breaks past the $4 trillion barrier, becoming the first public company in history to achieve that. On Wednesday, the chip designer’s shares had climbed by about 2.8% to $164.36.

Moreover, despite US export restrictions on its chips to China, the company’s stock has been rising for months, surging by over 40% since May.

Nvidia’s stock has surged 74% since April

In June 2023, Nvidia hit $1 trillion in market valuation for the first time. Since then, its shares have more than tripled within a year, outpacing the growth rates of Apple and Microsoft, which were the only other US companies valued above $3 trillion at the time. Apple had become the first to reach the $3 trillion mark in 2022.

Microsoft, valued at $3.725 trillion, sits just below Nvidia in market cap rankings. Apple follows with its valuation just above the $3 trillion mark. Of the three, Nvidia accounts for 7.3% of the S&P 500, surpassing Apple at 7% and Microsoft at 6%. 

So far, Nvidia has surged past all its Wall Street peers in nearly all aspects, but in April, it hit a rough patch after Trump’s reciprocal tariffs shook markets. It’s since rallied by over 74%, following renewed trader optimism over potential trade agreements with the US.

However, Daniel Ives, tech analyst at Wedbush, believes more tech corporations will soon join Nvidia, surpassing the $4 trillion valuation. He commented, “The poster children for the AI revolution are led by Nvidia and Microsoft as both are foundational pieces of building on the biggest tech trend we have seen in our 25 years covering tech stocks on the Street.”

He predicted that Microsoft could reach $4 trillion this summer and then, over the next 18 months, more corporations could enter $5 trillion territory, even as AI demand increases.

Nvidia generated close to $45 billion in Q1

According to LSEG, Nvidia is now more valuable than Canada and Mexico’s stock markets combined, and has even surpassed the entire UK equity market.

In Q1, the company earned $44.1bn, close to a 70% rise, and a profit of $0.81 a share. The firm expects over $45 billion in the second quarter,  with at least a plus or minus 2% leeway. Nonetheless, the quarterly results will be released on August 27.

AI chip demand has increased the firm’s shares more than fifteenfold over the last five years. Just last month, the Silicon-based chip maker saw its shares increase by more than 15% and 22% since the start of the year.

Earlier this year, the company had concerns over China’s DeepSeek model, which implied that their future AI systems might require fewer chips. Most AI startups, especially chatbots, rely heavily on Nvidia chips. If Deepseek chooses to reduce its chip use, the American firm will see a decline in sales and could even influence other chatbots to follow suit.

Then again, fresh export restrictions were imposed on its H20 chips designed specifically for the Chinese market in May. The company even projected that the controls would cost $8 billion in lost revenue. Jensen Huang, the firm’s CEO, asked the government to reconsider its decision, saying it could hurt America’s tech market in China.

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