Nvidia has become the world’s first company valued at $5 trillion thanks to the rise of the artificial intelligence industry and the US stock market. Just three months ago, the Silicon Valley chipmaker was the first to break the $4 trillion barrier in market value.
By comparison, Nvidia is worth more than the GDP of India, Japan and the United Kingdom, according to the International Monetary Fund (IMF). It has far outperformed its competitors in the chip industry, gaining momentum as numerous technology stocks have risen in recent days.
Shortly after the US stock markets opened on Wednesday, Nvidia shares hit $207.86 with 24.3 billion shares outstanding, putting its market capitalization at $5.05 trillion. The voracious appetite for Nvidia’s chips, considered the most advanced technology for powering artificial intelligence products and software, is the main reason the company’s stock price has risen so rapidly since early 2023.
The US stock market has hit multiple all-time highs this week, driven by expansive investment in artificial intelligence.
On Tuesday, Nvidia CEO Jensen Huang revealed $500 billion worth of chip orders. The company also announced a partnership with Uber on robotaxis and a $1 billion investment in Nokia, and the two plan to work together on 6G technology. Additionally, Nvidia is partnering with the US Department of Energy to build seven new AI-enabled supercomputers.
OpenAI’s extensive plans to scale its AI infrastructure also rely heavily on Nvidia technology. Last month, Nvidia announced it will invest $100 billion in OpenAI as part of a partnership that will add at least 10 gigawatts of Nvidia AI data centers to boost the computing power of AI chatbot owner ChatGPT.
Huang and Nvidia have also earned the endorsement of Donald Trump, who called the CEO “an incredible guy.” during a speech in South Korea on Wednesday. The president has frequently touted the company as a success story and suggested he could allow a less powerful version of the company’s Blackwell chip to be sold to China, a move that could potentially send Nvidia’s stock even higher. Trump too has a financial interest in the company, revealing in a financial report that he owned up to $1.3 million in Nvidia stock at the end of last year.
Trump said last week on Air Force One that he would speak with Chinese President Xi Jinping about Nvidia chips.
Reaching the new benchmark puts more emphasis on the upheaval unleashed by an artificial intelligence craze that is widely seen as the biggest tectonic shift in technology since Apple co-founder Steve Jobs unveiled the first iPhone 18 years ago. Apple leveraged the success of the iPhone to become the first publicly traded company valued at $1 trillion, $2 trillion, and eventually $3 trillion.
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But there are concerns about a possible AI bubble, with Bank of England officials earlier this month flagging the growing risk that tech share prices fueled by the AI boom could burst. The director of the IMF has raised the same alarm.
Part of the concern about an AI bubble revolves around the circular nature of some of the industry’s deals. Nvidia’s $100 billion investment in OpenAI, for example, depends on OpenAI’s own plans to buy millions of Nvidia chips. The need for these chips is also driven primarily by the tech industry’s desire to massively scale its computing power, even as there is growing concern from analysts about companies proving they are not getting income returns on their investments in AI and that almost all AI pilot programs in companies they fail.
