Growing demand for its AI chips has landed Nvidia
(NVDA) A prime spot in one of Wall Street’s most exclusive clubs: The chipmaker hit a $1 trillion market cap on Tuesday.
Nvidia That took Wall Street by surprise When it was announced last week Gangbusters earnings And a very strong earnings forecast for the coming year. Fueled largely by AI’s recent boom, the report boosted the stock price and secured its position as one of the world’s largest publicly traded companies.
Nvidia makes chips that create a type of AI Artificial intelligence New content such as text and images can be generated in response to user instructions. It is AI based on ChatGPT, Google’s Bard, Dall-E and many other new AI technologies.
Last quarter, the company’s profit rose 26% to $2 billion, and sales rose 19% to $7.2 billion, each easily beating Wall Street analysts’ forecasts. Nvidia’s outlook for the current quarter was significantly — about 50% — higher than analysts’ forecasts.
Its stock is up about 180% so far this year.
“NVIDIA delivered strong guidance that could be heard around the world and shows the historic demand for AI right now in the enterprise and consumer landscape,” said Dan Ives, analyst at Wedbush Securities. “Any investor calling this an AI bubble (crypto, metaverse, now the AI bubble thesis), we’ll point them to this Nvidia quarter, specifically confirming our neat thesis around AI, with AI now talking about the 4th industrial revolution. .”
Nvidia shares need to be above $404.86 to maintain a trillion dollar market cap. Shares of the stock are currently trading at $408.50.