Nvidia Corp’s valuation surpassed US$3 trillion ($4.5 trillion) on Wednesday night, making it the third company to reach this milestone.
Nvidia's stock price has more than doubled this year after tripling in 2023.
This growth is driven by the company’s artificial intelligence chips, which play a crucial role in AI development across various industries.
CEO Jensen Huang described this as a new industrial revolution, transforming US$1 trillion of data centres into “AI factories”.
Chip market control
Nvidia controls more than 80% of the AI chip market, with chips priced in the tens of thousands of dollars.
In March, Nvidia introduced its next generation of AI chips, code-named Blackwell, set to ship in the second quarter and operate in the fourth quarter, contributing significantly to this year’s revenue.
Melius Research analyst Ben Reitzes noted that Nvidia’s market position was expected to remain strong for at least the next two years.
“We don’t see anyone challenging Nvidia’s margin in a major way for the next two years given prospects for the Blackwell and the company’s following chip, Vera Rubin”, wrote Reitzes in a note to clients.
Nvidia's shares increased by 5.2% to $US1224.40, valuing the company at around $US3.011 trillion, slightly above Apple at $US3.003 trillion, and behind Microsoft (NASDAQ:MSFT). Nvidia last surpassed Apple Inc (NASDAQ:AAPL). in market value in March 2002.
Apple reached the $US3 trillion mark last year, followed by Microsoft earlier this year.
Nvidia plans a 10-for-1 stock split effective June 7, increasing its dividend to 10 cents a share from 4 cents, equating to 1 cent a share post-split.