Nvidia has overtaken Microsoft as the most valuable public company in the world, with a market value of $3.326 trillion after its stock rose by more than 3% during trading on Tuesday. This surge in value is due to Nvidia’s leading position in the artificial intelligence market, where it holds an 80% share of the processor market. The company’s stock has risen by more than 170% this year, making it a significant player in the tech industry.
Nvidia’s rise to the top spot marks a milestone in the tech sector that had been dominated by Apple since the launch of the iPhone in 2007. Earlier this year, Apple lost its top spot to Microsoft due to concerns about iPhone demand, but Microsoft’s investment in ChatGPT-maker OpenAI helped boost its shares in the generative AI field.
A recent stock split by Nvidia made its shares more accessible to individual investors and drove up demand for the company’s stock. Before the split, Nvidia shares were priced at over $1,000 each, but the stock split on June 7 made them more affordable for investors. This move saw a significant increase in Nvidia’s market value by more than $100 billion in just one day.
On the other hand, Microsoft’s shares have only risen by 19% so far this year, a modest figure compared to Nvidia’s performance. The strong demand for Nvidia’s processors, coupled with increased spending by companies like Meta Platforms and Google’s owner on AI computing capabilities, has contributed to Nvidia’s stellar performance in the stock market. Retail investors are considered winners in this scenario as the stock split has made Nvidia shares more accessible and attractive to a wider range of investors.