NVIDIA Surpasses $135, Secures Title as World’s Most Valuable Company

Thanks to the success of the burgeoning market for AI accelerators, NVIDIA has experienced tremendous growth this year. This is evident not only in the company’s rapidly growing revenues but also in its stock price and market capitalization. After breaking into the top 5 most valuable companies earlier this year, NVIDIA has reached the apex of Wall Street, closing out today as the world’s most valuable company.

With a closing price of $135.58 on a day that saw NVIDIA’s stock rise by another 3.5%, the company has topped both Microsoft and Apple in valuation, reaching a market capitalization of $3.335 trillion. This follows a rapid rise in the company’s stock price, which increased by 47% in the last month alone, particularly boosted by NVIDIA’s recent earnings report that exceeded estimates, as well as a recent 10-for-1 stock split. Over a longer period, NVIDIA’s stock has jumped a staggering 218% over the last year or an incredible 3,474% over the last 5 years.

NVIDIA’s rise continues a trend observed over the last several years, where tech companies dominate the top spots in market capitalization rankings. However, this period marks a notable instance where the traditional tech leaders, Apple and Microsoft, have been overtaken.

Market Capitalization Rankings
  Market Cap Stock Price
NVIDIA $3.335T $135.58
Microsoft $3.317T $446.34
Apple $3.285T $214.29
Alphabet $2.170T $176.45
Amazon $1.902T $182.81

The rapid growth in NVIDIA’s market capitalization has been driven by demand for its AI accelerators, especially the company’s server-grade H100, H200, and GH200 accelerators for AI training. As demand for these products surged, NVIDIA scaled up production accordingly, repeatedly surpassing market expectations for shipment volumes and pricing. Despite this growth, orders for NVIDIA’s high-end accelerators continue to backlogged, underscoring the unfulfilled demand from hyperscalers and other enterprises.

As a result, NVIDIA’s stock price and market capitalization have soared based on future expectations. With a price-to-earnings (P/E) ratio of 76.7—more than twice that of Microsoft or Apple—NVIDIA is valued more like a start-up than a 30-year-old tech company. However, this is not surprising given that most 30-year-old tech companies don’t triple their revenue in a single year, placing NVIDIA in a unique position at this time.

Like the stock market itself, market capitalizations are highly volatile. Historically, it’s uncertain whether NVIDIA will maintain the top spot for long, given day-to-day fluctuations. Currently, the valuations of NVIDIA, Apple, and Microsoft are all within $50 billion (1%) of each other, making the race very close among the three companies. Regardless of future shifts, NVIDIA now holds the rare distinction of having been the most valuable company in the world at one point.

Carousel image courtesy MSN Money

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