Investors, perhaps searching for a foundation upon which to lay their AI investments, appear to have found one: Nvidia, whose market capitalization Tuesday makes it the first trillion-dollar chip maker.
At press time, Nvidia’s stock price had jumped to $409.76 per share, giving it a market capitalization of $1.014 trillion.
Nvidia’s fortunes soared last week, when the company reported net income of $2.04 billion on revenue of $7.192 billion. Surprisingly, revenues fell 13 percent from a year ago. Investors ignored that, however, as Nvidia estimated that the current quarter would bring in $11.0 billion in revenue, an almost unheard-of quarter-over-quarter increase. Wall Street sent shares soaring from about $303 to just under $380 overnight.
Although a number of chip companies, big and small, have invested in AI, Nvidia is seen as perhaps the largest and most viable vendor right now. Most AI functions require large amounts of repetitive computational power and memory to operate in—and Nvidia’s GPUs are primarily the chief driver on the consumer side. At Microsoft Build, for example, Nvidia said that its RTX GPUs will add Max-Q low-power inferencing for AI workloads. Nvidia also announced a partnership with Mediatek to provide a graphics/AI chiplet, though just in the automotive space.
Nvidia spent most of Computex talking about its enterprise announcements, however, including that what Nvidia calls its GH200 Grace Hopper Superchip is in full production for AI workloads across the globe.
“There’s a war going on out there in AI, and Nvidia today is the only arms dealer out there,” Srini Pajjuri, a managing director at investment firm Raymond James, said according to Yahoo Finance. “So as a result we’re seeing this huge jump in revenues.”
That’s not necessarily true, of course. Rival AMD is also trying to push into AI, with chief executive Dr. Lisa Su telling analysts that AI was the chief strategic priority at the company. AMD’s Ryzn AI and Intel’s Meteor Lake will add AI, too.
For right now, however, investors don’t care. Nvidia is pushing its chips into AI, and Wall Street is pushing its chips onto Nvidia.
