Nvidia’s shares hit record levels amid rising AI demand
Nvidia has recently achieved an all-time high on Wall Street. Its latest stock surge is driven by a rapidly growing demand for AI infrastructure, as major companies like Microsoft, Meta, and Google continue to invest heavily in AI development.
Nvidia’s stock surge
On Monday, Nvidia’s stock climbed 2.4 percent, closing at a record high of $138.07. This impressive leap surpassed its previous peak of $135.58, set in June. Its shares have surged nearly 180 percent throughout the year and have skyrocketed more than nine-fold since the beginning of 2023.
As the generative AI revolution, which took off with OpenAI’s release of ChatGPT in November 2022, continues to grow, Nvidia’s products have become essential. The company’s Graphics Processing Units (GPUs) are the engines that power advanced AI models, making it a key player in the global race to develop AI technologies.
Nvidia’s revenue growth has been astonishing. Over the past five quarters, its revenue has more than doubled, and in some cases, it has tripled. For the quarter ending in October, analysts project a growth rate of about 82%, which translates to $32.9 billion. While growth is expected to slow modestly, the demand for AI infrastructure remains strong. Its market cap currently stands at an astonishing $3.4 trillion, making it the second-most valuable publicly traded company in the US, behind Apple, which sits at about $3.55 trillion.
Nvidia’s market dominance
When it comes to AI training and inference chips, Nvidia holds about 95 percent of the market share, according to analysts at Mizuho. Competitors like AMD and Intel have made some progress, but Nvidia remains the undisputed leader.
Microsoft has been a frontrunner in AI investments, particularly through its partnership with OpenAI. Meta is also betting big on AI, using Nvidia’s technology to power its own AI-driven services. Google, a leader in AI research, has been one of Nvidia’s top customers, leveraging GPUs to enhance its AI-driven search algorithms and cloud services. Amazon Web Services (AWS), the dominant player in cloud computing, has been expanding its AI capabilities, again with Nvidia’s GPUs at the core.
Nvidia’s upcoming Blackwell GPU is already generating enormous excitement. CEO Jensen Huang recently referred to demand for Blackwell as “insane.” The company anticipates billions in revenue from this next-gen chip by the fourth quarter. Blackwell is expected to bring unprecedented performance improvements, further solidifying Nvidia’s lead in the AI chip market.
Nvidia has several new product launches planned, including next-generation GPUs and AI-focused solutions. The company’s long-term growth potential remains strong, as AI continues to reshape industries around the world.
