Nvidia Corp. became the largest company in the world on Tuesday, surpassing Apple Inc. and underscoring just how dominant artificial intelligence has become on Wall Street.
Shares rose 2.9% to $139.93, resulting in a market capitalization of $3.43 trillion, ahead of Apple at $3.38 trillion. Microsoft Corp., which Nvidia passed last month, has a market cap of $3.06 trillion. Nvidia has soared more than 850% since the end of 2022.
“Over the past several quarters, it has felt like people basically care about inflation numbers, job numbers, and Nvidia numbers,” said Fall Ainina, director of research at James Investment Research. “Nvidia overtaking Apple in market cap not only conveys that it is the biggest beneficiary of the AI infrastructure cycle, but it suggests people expect the AI boom will continue.”
The chipmaker accounts for 7% of the weight of the S&P 500 Index and is responsible for about a quarter of the benchmark’s 21% gain this year. Nvidia previously closed with the title of largest company in June, although it only held the record for a day.
The biggest companies on Wall Street are all heavily exposed to artificial intelligence: Apple with its newly launched AI iPhones; Microsoft, Amazon.com Inc., and Alphabet Inc. with their cloud businesses and AI services; and Meta Platforms Inc.’s AI features and ad targeting. With the exception of Apple, these companies are all among Nvidia’s largest customers, and they have stressed their commitment to continuing to spend on AI.
Last week, Apple’s results underlined concerns about its revenue growth, along with weakness in China. Nvidia will report later this month.
Not only are the biggest companies by market cap AI plays, but so are the year’s top stock performers. Nvidia’s 183% advance is the third-largest in the S&P 500 this year, behind Vistra Corp. — the power producer that has seen a surge in demand related to AI — and data-analysis software firm Palantir Technologies Inc.
Recent strength has come as the company calmed investor concerns about issues involving its Blackwell chip, which was delayed due to engineering snags, as well as its long-term growth prospects.
Analysts expect Nvidia’s revenue to more than double in its current fiscal year and rise another 44% during the following, according to data compiled by Bloomberg. Wall Street analysts have continually raised estimates for Nvidia’s earnings and profit over the past quarter.
Beyond the Blackwell optimism, recent sales from Taiwan Semiconductor Manufacturing Co. showed strong AI demand, while a funding round for OpenAI resulted in a $157 billion valuation. OpenAI recently released an AI model with reasoning capabilities, something Alphabet Inc. is also working on.
“The implication of AI is extraordinarily large, and these big tech companies are investing hundreds of billions into it, with Nvidia benefiting the most,” said James Investment’s Ainina. “Overall there continues to be a good picture for its prospects.”
