NVIDIA Becomes World's Most Valuable Company

On Tuesday, June 18, NVIDIA's stock price surged over 3%, elevating its market value to $3.33 trillion. This milestone positions NVIDIA as the world's most valuable company, surpassing Microsoft. Earlier this month, NVIDIA's market value reached $3 trillion, overtaking Apple's market capitalization.

As of the latest trading update, NVIDIA's stock (NVDA-US) increased by 3.18% on Tuesday, closing at $135.16 per share, resulting in a market cap of $3.331 trillion. In contrast, Microsoft's stock (MSFT-US) fell by 0.22%, closing at $447.38 per share, with a market cap of $3.326 trillion.

NVIDIA's stock has seen an impressive rise of over 170% this year, with notable gains following its Q1 financial report in May. Since the end of 2022, NVIDIA's stock has grown more than ninefold, driven by the rapid expansion of generative artificial intelligence (AI).

NVIDIA commands about 80% of the AI chip market for data centers. This sector has experienced significant growth as companies like OpenAI, Microsoft, Alphabet (GOOGL-US), Amazon (AMZN-US), and Meta (META-US) compete for processors to build AI models and handle increasing workloads. In the latest quarter, NVIDIA's data center business revenue soared by 427% year-over-year to $22.6 billion, accounting for approximately 86% of the company's total sales.

Founded in 1991, NVIDIA initially focused on hardware, selling chips for 3D gaming, cryptocurrency mining, and cloud gaming subscriptions. Over the past two years, however, its stock price has skyrocketed as Wall Street recognized its technology as a key driver behind AI's explosive growth, which shows no signs of slowing down. According to Forbes, NVIDIA co-founder and CEO Jensen Huang's net worth has surpassed $117 billion, ranking him 11th on the global rich list.

Meanwhile, Microsoft's stock has risen about 20% year-to-date. The software giant has also benefited significantly from the AI boom, acquiring a substantial stake in OpenAI and integrating its AI models into its products, including Office and Windows. Microsoft is a major buyer of NVIDIA's GPUs for its Azure cloud services. Recently, Microsoft launched a new generation of laptops, named Copilot+, designed specifically to run its AI model.

NVIDIA's rapid market value increase has led to its exclusion from the Dow Jones Industrial Average, a benchmark index comprising 30 of the most valuable U.S. companies. Last month, NVIDIA announced a 10-for-1 stock split, effective January 7.