In a historic feat, Nvidia, the renowned chipmaker, has crossed the elusive $2 trillion valuation mark, buoyed by an optimistic outlook from Dell Technologies that reignited Wall Street’s fervent rally in artificial intelligence (AI) technology.
Nvidia’s stock soared by 4% after Dell, a prominent seller of high-end servers equipped with Nvidia’s processors, delivered a bullish forecast late on Thursday, highlighting a significant uptick in orders for its AI-optimized servers.
The ripple effect was palpable as Dell’s shares skyrocketed by as much as 38% to reach a record high before concluding the session with a staggering 32% gain.
Friday’s remarkable rally propelled Nvidia’s market capitalization to $2.06 trillion, firmly establishing it as Wall Street’s third most valuable company, trailing only Microsoft and Apple, with market caps of $3.09 trillion and $2.77 trillion, respectively. Super Micro Computer, another firm in the server business with Nvidia’s chips, also experienced a notable 4.5% surge in its stock price.
The enthusiasm spilled over into the broader chip industry, with other AI-focused chipmakers achieving record highs. Broadcom and Marvell Technology saw gains of approximately 8%, while Advanced Micro Devices (AMD) climbed over 5%. The Philadelphia Semiconductor Index (PHLX) surged by 4.3% to reach its own record high, accumulating an impressive 2024 gain of 18%.
Nvidia currently commands around 80% of the high-end AI chip market, catering to esteemed clients such as OpenAI, Microsoft, Alphabet, and Meta Platforms, all vying for limited supplies of its cutting-edge components to compete in the rapidly evolving generative AI sector.
The Santa Clara-based company has recently emerged as the most traded stock by value on Wall Street, surpassing Tesla. Over the past 30 sessions, investors have exchanged an average of $36 billion worth of Nvidia’s shares daily, compared to $21 billion for Tesla. Trading activity in Nvidia on Friday alone reached a staggering $38 billion worth of shares.
This surge in Nvidia’s valuation comes on the heels of its phenomenal performance in the market. On February 23, the company added a staggering $277 billion in stock market value in a single session, setting a new Wall Street record, following its forecast of a roughly threefold surge in quarterly revenue.
In 2024 alone, Nvidia’s stock has surged by an impressive 66%, building on its remarkable tripling in value the previous year. Last month, its market value surpassed that of tech giants Amazon and Alphabet.
While Saudi Aramco boasts a market capitalization of $2.045 trillion, it’s noteworthy that over 90% of its shares are closely held by the Saudi Arabian government, with less than 2% available for trading by investors, as per LSEG data.
