Nvidia has risen from a modest graphics card maker to incredible new heights by riding the tech industry’s AI craze. The company added $329 billion to its market cap after a record-breaking day on Wall Street. Nvidia’s meteoric rise has reignited excitement about artificial intelligence and machine learning.
Nvidia’s massive valuation: $329 billion in one day!
Nvidia is known by many as the maker of chips that power Android phones, Nintendo Switches, and high-end PC gaming machines. It made its big splash designing the graphics card for Microsoft’s original Xbox and helping Sony design the graphics processor for the PlayStation 3. For years, it was known for its powerful graphics cards that impressed gamers but were beyond the means of many. Now, the company is rapidly becoming something else.
At the beginning of 2023, Nvidia shares were trading below $15. Two years later, they were above $100. What was behind this change? Microsoft and others are rapidly buying graphics cards to pursue their AI ambitions.
Despite a wave of skepticism about generative AI and machine learning, Nvidia shares rose more than the combined value of many companies in less than eight hours after Microsoft announced that it would continue to invest billions of dollars in server farms for AI computing.
Nvidia’s gains were greater than the combined value of Netflix, Coca-Cola, and Bank of America. This increase, which is equivalent to the value of eight Electronic Arts and 12 Take-Twos, shows how much Nvidia has changed in just one day.
The company reached its highest value last month, exceeding $3 trillion, but this single-day surge shows how disconnected Nvidia is from its recent past or the current market reality. As the meta shifts from VR to the AI chip race and others try to catch up, Nvidia has quickly become the center of the tech and financial worlds.
We may be witnessing the first phase of Nvidia’s transformation from its current state. Perhaps it will be the first true mega-corporation in a future cyberpunk dystopia. What do you think? Please share your thoughts in the comments below.
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