FX.co ★ Nvidia becomes second-largest company by market cap

Nvidia is now the world's most valuable public company. The success could be explained by the company’s cutting-edge chips. These products are essential for developing innovative artificial intelligence (AI) technology.

In mid-June, Nvidia surpassed Apple, becoming the second-largest company by market capitalization. Now, the chip maker has overtaken Microsoft to claim the top spot.

On June 18, Nvidia's stock price rose by 3.5%, boosting its market capitalization to $3.34 trillion. Notably, Microsoft's market value trails the new tech giant by just $200 billion.

According to The Guardian, Nvidia's rising stock makes it more attractive to individual investors. Analysts describe Nvidia as the global hub of the industry, whose success is driven by groundbreaking AI developments. Many major companies are actively purchasing Nvidia's chips and graphics processors to work with AI. This demand has driven Nvidia's stock up by 180% in 2024, while Microsoft's shares have only risen by 19%.

Experts observe that the demand for Nvidia processors exceeds supply. By enhancing the appeal of its shares among individual investors, the tech giant recently split its stock ten to one. This split could lower the price per share, making it more accessible to market participants.

Notably, many AI industry tools, including OpenAI's ChatGPT, are based on Nvidia chips. "The company’s rising stock price and increased prominence within the industry have made its earnings reports and announcements into destination events for Silicon Valley investors. Increased demand for its chips has also made the price per unit rise to about $30,000 and seen the company’s revenue surge," the Guardian wrote.

Thanks to the rapid rise in the tech giant's stock, Jensen Huang, the company's CEO, now has a fortune exceeding $100 billion, earning him 11th place in Forbes' international ranking.