Nvidia made history Wednesday as the first company to reach a market value of $5 trillion, thanks to a stunning rally and the global artificial intelligence boom.
The milestone underscores the company's rapid transformation from a niche graphics chip designer to a mainstay of the global artificial intelligence industry, turning CEO Jensen Huang into a Silicon Valley icon and turning its cutting-edge chips into a flashpoint in the technology rivalry between the United States and China.
Since ChatGPT launched in 2022, Nvidia shares have risen 12-fold as an artificial intelligence frenzy has lifted the S&P 500 to record highs, sparking debate over whether high tech company valuations could lead to the next big bubble.
The new milestone comes just three months after Nvidia. exceeded the $4 trillion mark..
“Longer-term, we expect tech giants to seek second sources or in-house solutions to diversify from Nvidia into AI, but these efforts will at best weaken, rather than supplant, Nvidia's dominance in AI,” said Brian Colello, senior equity analyst at Morningstar.
Shares of the Santa Clara, California-based company rose 4.6% after a series of recent announcements cemented its dominance in the AI race.
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On Tuesday, Huang announced a $500 billion order for artificial intelligence chips and said he plans to build seven supercomputers for the U.S. government.
Meanwhile, US President Donald Trump is expected to discuss Nvidia's Blackwell chip with Chinese President Xi Jinping on Thursday. Sales of the high-performance chip have become a key sticking point between the two sides in trade talks over Washington's export controls.
The splash increases Juan's wealth
At current prices, CEO Huang's stake in Nvidia would be worth about $179.2 billion, according to regulatory filings and Reuters calculations. He is the eighth richest person in the world, according to the Forbes billionaires list.
Huang was born in Taiwan and raised in the United States from the age of nine. He has led Nvidia since its founding in 1993. Under his leadership, the company's H100 and Blackwell processors became the driving force behind big language tools like ChatGPT and Elon Musk's xAI.
While Nvidia remains the largest player in artificial intelligence, the market value of companies from major tech companies such as Apple and Microsoft also recently exceeded $4 trillion (Apple crossed this threshold just yesterday).
Analysts say the rise reflects investor confidence in relentless AI spending, although some warn valuations could be high.
“The current expansion of AI depends on several dominant players funding each other's capabilities. The moment investors start demanding cash returns instead of capacity announcements, some of these flywheels could break,” said Matthew Tuttle, CEO of Tuttle Capital Management.
Technology companies' heavy weighting in the S&P 500 and Nasdaq 100 indices gives them broad influence on global markets.
Nvidia is scheduled to report quarterly results on November 19.
Geopolitical bargaining chip
The company's dominance has drawn the attention of global regulators, and restrictions on exports of advanced chips to the United States have made it a key pawn in Washington's strategy to limit China's access to artificial intelligence technology.
“Nvidia clearly brought its story to Washington to both educate and win favor with the US government,” said Bob O'Donnell of Technasis Research. “They managed to touch on most of the hottest and most influential topics in technology.”
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companies developer conference on Tuesday also served as a platform for Juan to walk a geopolitical tightrope.
He praised Trump's “America First” policies to accelerate domestic investment in technology, while warning that excluding China from the Nvidia ecosystem could limit U.S. access to half of the world's artificial intelligence developers.
Rivals including Advanced Micro Devices and several well-funded startups are racing to challenge Nvidia's dominance in high-end artificial intelligence chips, but it remains the industry's top choice.
