Nvidia shares reached a record high, nearing Apple’s market value. Nvidia’s stock closed at their highest rise ever on Monday, putting the heavyweight AI chipmaker on the brink to dethrone Apple as the world’s most valuable company. Investors are optimistic about Nvidia’s AI processors, driving stock up 2.4% to $138.07.
With investors betting on strong demand for its current and next-generation AI processors, the Santa Clara, California company Nvidia’s stock climbed 2.4% to end the day at $138.07.
Nvidia world’s most valuable company
In June, Nvidia briefly became the world’s most valuable company. Nvidia overtook Microsoft, and the tech trio’s market capitalizations have been neck-and-neck for several months.
The latest gains in stocks lifted Nvidia’s market cap to $3.39 trillion, just below Apple’s $3.52 trillion value and above Microsoft’s $3.12 trillion.
Nvidia has been Wall Street’s biggest winner from a race between Alphabet, Microsoft, Amazon and other major tech companies to dominate emerging AI technology.
Nvidia on brink to dethrone Apple
“We believe the major companies in AI … face an investment environment characterized by a Prisoner’s Dilemma — each is individually incentivized to continue spending, as the costs of not doing so are (potentially) devastating,” TD Cowen analysts wrote in a report on Sunday.
TD Cowen reiterated its $165 price target for Nvidia, which it called its “Top Pick”, and it said demand for the company’s current generation of AI chips remained strong.
Nvidia’s production
Nvidia in August confirmed reports that a ramp-up in production of its upcoming Blackwell chips was delayed until the Q4, but downplayed the impact, saying customers were snapping up existing chips.
Stock update
As investors gear up for quarterly reporting season, Apple rose almost 2% and Microsoft added 0.7%, helping propel the S&P 500up 0.8% to its own record high close.
Nvidia, Apple and Microsoft account for about a fifth of the S&P 500’s weight, giving them a hefty influence in the index’s day-to-day gains and losses.
Taiwan Semiconductor Manufacturing Co, the contract manufacturer that produces Nvidia’s processors, is expected to report a 40% leap in quarterly profit on Thursday, thanks to soaring demand.
While Nvidia’s rally has lifted the S&P 500 to record highs, investors worry optimism about AI could evaporate if signs emerge of a slowdown in spending on the technology.
Nvidia’s spend
Analysts expect spending to build out AI data centers will help Nvidia’s annual revenue more than double to nearly $126 billion, according to LSEG data.
