Nvidia becomes the first $5 trillion corporation in history.
This isn't just a number; it highlights Nvidia's rapid evolution from a specialized graphics-chip maker to the fundamental engine driving the entire global AI sector. In the process, CEO Jensen Huang has become a true Silicon Valley legend, and their cutting-edge chips are now a major point of contention in the ongoing tech competition between the US and China.
Ever since ChatGPT burst onto the scene in 2022, Nvidia's stock has skyrocketed an astonishing 12-fold! This AI craze has also pushed the S&P 500 to unprecedented heights, sparking a lively discussion about whether these soaring tech valuations might be hinting at the next big market bubble.
What's even more impressive is that this latest achievement comes just three months after Nvidia first crossed the $4 trillion threshold. To put it in perspective, its market cap now outstrips the *entire* cryptocurrency market and is roughly equivalent to half the size of Europe's benchmark equities index, the Stoxx 600.
As Matt Britzman, a senior equity analyst at Hargreaves Lansdown (who, full disclosure, holds shares in Nvidia) wisely put it, "Nvidia hitting a $5-trillion market cap is more than a milestone; it’s a statement, as Nvidia has gone from chip maker to industry creator." He added, "The market continues to underestimate the scale of the opportunity, and Nvidia remains one of the best ways to play the AI theme."
The Santa Clara, California-based tech giant saw its shares jump by 4.6% following a series of recent announcements that further cemented its leadership in the AI arena. Just on Tuesday, CEO Jensen Huang revealed an incredible $500 billion in new AI chip orders and even announced plans to construct seven supercomputers for the US government.
On a related note, US President Donald Trump is slated to discuss Nvidia’s advanced Blackwell chip with Chinese President Xi Jinping on Thursday. Sales of this high-end chip have become a significant point of contention between the two nations, primarily due to Washington's strict export controls.
Based on current prices, CEO Huang's personal stake in Nvidia is now estimated to be worth around $179.2 billion, according to regulatory filings and Reuters' calculations, placing him as the world's eighth-richest individual on Forbes' billionaire list.
Born in Taiwan and having moved to the US at age nine, Huang has been at the helm of Nvidia since its inception in 1993. Under his visionary leadership, Nvidia's H100 and Blackwell processors have become the crucial engines powering the large language models behind popular AI tools like ChatGPT and even Elon Musk's xAI.
While Nvidia is undeniably leading the charge in the AI race, it's worth noting that other Big Tech giants like Apple and Microsoft have also recently surpassed the $4 trillion market value mark. Analysts suggest this widespread rally stems from strong investor confidence in continuous AI spending, though some experts are starting to caution that valuations might be getting a little 'hot'.
Matthew Tuttle, CEO of Tuttle Capital Management, expressed a thoughtful concern: "AI’s current expansion relies on a few dominant players financing each other’s capacity. The moment investors start demanding cash-flow returns instead of capacity announcements, some of these flywheels could seize."
It's also important to remember that tech companies hold significant sway in major indices like the S&P 500 and Nasdaq 100, granting them considerable influence over global financial markets.
