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25 June 2024
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Nvidia Overtakes Apple, Hits $3 Trillion on AI Momentum

Nvidia has momentarily surpassed Apple to become the world’s second most valuable publicly traded company. This milestone was reached during intraday trading on Wednesday, with Nvidia’s market cap peaking at $3.007 trillion, slightly above Apple’s valuation of $3.005 trillion.

This shift underscores the growing investor enthusiasm for companies at the forefront of the artificial intelligence (AI) revolution.

Nvidia’s Ascendancy in the AI Market

Nvidia’s increase in market capitalization can be attributed to its leadership position in the AI chip market, which is estimated to hold 80% of the market. The company’s focus on developing GPUs for data centers has been very profitable, with its data center business bringing in 22.6 billion in sales in the last quarter alone, which was 86% of its overall revenue.

This shows a 427% rise from the previous year which underpins the need for AI skills across different sectors.

Nvidia has successfully shifted its focus from being a gaming hardware manufacturer to an AI technology company, which has garnered a lot of investment, sending its shares up by more than 24% after the company released its first-quarter earnings in May. This growth trajectory has been maintained over the past year, with the stock price rising over 3,290% in the last five years.

Comparative Performance with Apple

While Nvidia has been skyrocketing, Apple has been relatively stable with a 5% growth this year. The US-based technology firm that became the first American company to attain a $3 trillion market capitalization in January this year has faced some difficulties, including the slowing down of sales growth, especially in the iPhones that had a 10% decline compared to the same period last year. 

These challenges are also based on the strategic issues regarding the demand in such significant regions like China as well as the responses to the new products of the company, including the Vision Pro virtual reality headset.

However, Nvidia has been able to expand into Artificial Intelligence and cloud services and managed to increase its market capitalization at a very high rate hitting certain marks in a very short time only. This is also in line with the current market trends where investors are focusing more on companies that are key players in the AI technology space.

Concurrently, Nvidia appears poised for continued growth, especially as it prepares for a 10-1 stock split later this month, which may make its shares more accessible to a broader range of investors.

Read Also: Shiba Inu (SHIB) Under Intense Whale Siege, Trillions Stacked Amid Price Rebound

The post Nvidia Overtakes Apple, Hits $3 Trillion on AI Momentum appeared first on CoinGape.

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