AI chipmaker Nvidia Corp. has notched yet another record by being the first company globally to reach a market capitalization of $5 trillion. Just three months prior, the firm had set another record of being first to have a market cap of $4 trillion.
This new record was reached on Wednesday when a share of the firm reached $207.8 a piece, pushing the company’s market cap to $5.05 trillion. To put this achievement in context, this market capitalization makes the firm to be larger than the entire GDP of countries like Japan, the UK and even India, per IMF data.
The rush to acquire Nvidia shares has helped its stock to rise dramatically since 2023 as the firm has cemented and keeps growing its leadership in the fast-growing AI industry. The AI boom has buoyed not just Nvidia but also its competitors and the general stock market in the U.S.
Jansen Huang, Nvidia’s CEO, revealed on Tuesday that the firm had orders for AI chips worth $500 billion. The next day, the company’s stock spiked in price and resulted in this record-setting unprecedented market valuation. The company also revealed that it was partnering with Uber on the latter’s push to make robotaxis, and that Nvidia was also working with Nokia on a project involving 6G. Nvidia would inject $1 billion in this project with Nokia.
The successes that the Huang-led Nvidia has registered has endeared the company to President Trump, who referred to the CEO as “incredible” on Wednesday while Trump made a speech during his visit to South Korea. It has also come to light that Trump holds Nvidia stock worth approximately $1.3 million.
This rise of Nvidia follows in the footsteps of another American tech firm, Apple Inc., which previously made history when it reached the $1 trillion market cap after Steve Jobs debuted the firm’s maiden iPhone nearly two decades ago. The company went on to grow to a $2 trillion market cap, and then $3 trillion. These milestones were all global records. Nvidia is now taking it a notch higher by setting its own market capitalization records previously unattained across the globe.
This meteoric rise of American tech stocks has triggered concerns about a potential AI bubble in the making. Top officials at the IMF and the Bank of England are among those sounding the alarm about the possibility of this bubble bursting at some point given that AI firms are struggling to monetize their innovations.
That aside, American companies like Broadcom Inc. (NASDAQ: AVGO) have also had their share of the windfall coming to tech stocks with plays in the AI field, and the successes they are scoring are helping the U.S. and global economy to keep growing.
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