Nvidia Overtakes Microsoft as World’s Leading Company, Fueled by AI Growth


Nvidia became the world’s most valuable company on Tuesday, surpassing tech giant Microsoft due to the central role its high-end processors play in the race to dominate Artificial Intelligence technology. Shares of the chipmaker climbed 3.5 percent to $135.58, pushing its market capitalization to $3.335 trillion.

Microsoft’s market value stood at $3.317 trillion as its shares dipped 0.45 percent. Apple’s stock slipped over 1 percent, reducing its value to $3.286 trillion. Nvidia’s remarkable surge in market value over the past year epitomizes a Wall Street frenzy fueled by optimism about emerging AI technology.

While Nvidia’s rally has driven the S&P 500 and Nasdaq to record highs, some investors caution that unbridled enthusiasm for AI could wane if signs emerge of a slowdown in technology spending. Nvidia has also become the most traded company on Wall Street, with daily turnover recently averaging $50 billion, compared to around $10 billion each for Apple, Microsoft and Tesla, according to the sources. The chipmaker now accounts for about 16 percent of all trading in S&P 500 companies.

Nvidia’s stock has nearly tripled this year, compared to a rise of about 19 percent in Microsoft shares, with demand for its top-of-the-line processors outpacing supply. Tech giants Microsoft, Meta Platforms, and Google-owner Alphabet are racing to enhance their AI computing capabilities and integrate the technology into their products and services.

“Nvidia has been getting a lot of positive attention and has been doing a lot of things very correctly, but a small misstep is likely to cause a major correction in the stock, and investors should be careful,” said Oliver Pursche, Senior Vice President at Wealthspire Advisors in New York. Nvidia executives stated in May that demand for its Blackwell AI chips could exceed supply “well into next year.”

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