Infographic: AI Boom: Nvidia Becomes Most Valuable Company in the World (2024)

On May 24, 2023 – Nvidia’s market cap hovered around $750 billion at the time – the chipmaker announced results for its first fiscal quarter of 2024. Revenue was up 19 percent, net income increased 26 percent – everything looked positive, but not extraordinarily so. It was the company’s second quarter outlook predicting a 65 percent jump in revenue as well as the words of CEO Jensen Huang that sparked one of the most remarkable stock market rallies in recent memory.

“The computer industry is going through two simultaneous transitions — accelerated computing and generative AI,” Huang said at the time. “A trillion dollars of installed global data center infrastructure will transition from general purpose to accelerated computing as companies race to apply generative AI into every product, service and business process.” What investors heard was that Nvidia was at the forefront of a trillion-dollar opportunity, which immediately sent the company’s share price to unprecedented highs. The next day, Nvidia added nearly $200 billion to its market capitalization and that was only the beginning.

In June 2023, the company reached a market capitalization of $1 trillion for the first time, on March 1, 2024 it closed above $2 trillion and a little more than three months later, it surpassed $3 trillion. Earlier this week, Nvidia passed the ultimate milestone, when its market cap, boosted by a recent stock split, surged past Microsoft and Apple to make the chipmaker the most valuable company in the world. While investors will certainly have enjoyed the ride up to this point, questions over whether Nvidia’s current valuation is justified and sustainable are naturally getting louder. While some are arguing that we’re still just at the beginning of the AI boom, others aren’t yet convinced that AI will deliver on the hype that tools like ChatGPT have created over the past two years.