Nvidia Market Cap Surpasses $1 Trillion, First American Chipmaker To Hit The Milestone

By: Asia Business Outlook Team | Wednesday, 31 May 2023

Nvidia Corp's market capitalization surpassed $1 trillion on May 30, making it the first US chipmaker to do so. The gaming and AI chip company, whose shares rose 3.8% in pre-market trading on Tuesday, was valued at $1.03 trillion. Nvidia stunned investors by reporting a quarterly profit of more than $2 billion and revenue of $7 billion, both of which exceeded Wall Street expectations.

Meta Platforms Inc, valued at approximately $670 billion as of last close, achieved the trillion-dollar market capitalization milestone in 2021, joining Apple Inc, Alphabet Inc, Microsoft Corp, and Amazon.com Inc as members of the club.

Wall Street analysts praised Nvidia's forecast as "unfathomable" and "cosmological," raising their price targets dramatically. The highest price target placed the company at around $1.6 trillion, on par with Alphabet, Google's parent company.

Jensen Huang, CEO of Nvidia, unveiled a new batch of AI-related products and services, hoping to capitalise on the frenzy that resulted in his wealth increasing by nearly $7 billion last week to nearly $35 billion.

"Given the valuation is well above the long-term average, there will be significant pressure to deliver high growth on a consistent basis... there could be volatility in its share price to come," Hargreaves Lansdown's head of money and markets, Susannah Streeter, said.

Nvidia's stock rose about 25% last week, sparking a rally in AI-related stocks and boosting other chipmakers, helping the Philadelphia SE Semiconductor index close at its highest level in over a year on Friday.