News Brief

How Artificial Intelligence Made Nvidia World's Most Valuable Company Replacing Microsoft

Nishtha Anushree

Jun 19, 2024, 02:48 PM | Updated 02:48 PM IST

NVIDIA chief holding up the new Blackwell GPU alongside its predecessor, Hopper.
NVIDIA chief holding up the new Blackwell GPU alongside its predecessor, Hopper.

Boosted by the growth of Artificial Intelligence (AI), Nvidia has become the world’s most valuable company with a market capitalisation of $3.335 trillion.

Nvidia achieved this feat after knocking Microsoft off the top spot as the latter's shares fell by 0.45 per cent. This comes days after Nvidia replaced Apple to become the world’s second most valuable company.

Now Microsoft and Apple are at second and third positions respectively, while the Santa Clara California-based Nvidia has lifted the S&P 500 and Nasdaq indexes to record highs.

This became possible because the graphics processing units (GPUs) manufactured by Nvidia are integral to the development of AI. Its chips are in high demand from companies like Microsoft, Meta and Google.

Nvidia has showcased a spectacular rise as the company’s stock price increased by nearly 182 percent this year alone. The stock price more than tripled in 2023.

Currently, the company has around 80 per cent market share in AI chips, which are used in data centres that run AI models such as OpenAI’s ChatGPT.

Since its entry in the stock market in 1999, its share price increased by 591,078 percent. Earlier, the company used to produce chips for computer games.

The company then started to invest heavily in developing GPUs for use in applications besides gaming on the direction of chief executive Jensen Huang, making it capable of capitalising on the emergence of AI.

Nishtha Anushree is Senior Sub-editor at Swarajya. She tweets at @nishthaanushree.

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