The chipmaker has firmly placed itself at the centre of the global AI boom.
Chips giant Nvidia has made history yesterday (29 October) as the first company to reach a market value of $5trn, having only recently surpassed the $4trn mark, where it beat rivals Apple and Microsoft to the milestone. Both organisations have since passed the $4trn point, Microsoft in July, followed by Apple earlier this week.
By the end of Wednesday’s stock market session, company shares for Nvidia were up by 3pc at $207.04 a share.
The global AI boom has played a significant role in Nvidia’s success, as it has been integral in developing chips to power AI infrastructure. This past week, Nvidia’s CEO made several key announcements regarding the future of the company amid increased global investment in AI.
For example, a $500bn chip order, a partnership with Uber to develop robotaxis, plans to build seven AI supercomputers in collaboration with the US Department of Energy and a $1bn investment in Nokia to advance 5G and 6G telecommunication technologies.
Just over a month ago, it was announced that Nvidia will be investing $100bn into OpenAI, as part of a partnership that will enable OpenAI to scale its AI infrastructure using Nvidia’s technology. Reportedly in return for a “significant stake” in the company. Described as a “giant project” by Huang, the first phase of the project is expected towards the second half of 2026.
“Nvidia hitting a $5trn market cap is more than a milestone; it’s a statement, as Nvidia has gone from chip maker to industry creator,” Matt Britzman, a senior equity analyst at Hargreaves Lansdown, told Reuters.
“The market continues to underestimate the scale of the opportunity and Nvidia remains one of the best ways to play the AI theme.”
The news comes amid a period of tension however, as the US-China trade war continues. In April, Nvidia was informed by the US government that it would require an export licence to sell previously approved H20 processors to China, at a cost of $4.5bn to the company. This prompted Huang to say on an earnings call with investors that the Chinese market for AI chips is “effectively closed to US industry”.
However, more recently, Nvidia agreed a deal with the US government to pay a 15pc tax on revenue generated from chips sales in China in order to obtain export licences.
The use of semiconductor chips was raised as a key issue for US president Donald Trump as he today (30 October) met with Chinese president Xi Jinping in South Korea. Trump called the meeting a success as it scored “12 out of 10”. He stated that the White House only acts as a “referee’ between China and large tech firms such as Nvidia.
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