Chipmaker Nvidia becomes first five trillion dollar company
Nvidia has become the first five trillion dollar (£3.8 trillion) company, just three months after the Silicon Valley chipmaker was the first to break through the four trillion dollar (£3 trillion) barrier.
Hitting the new benchmark puts more emphasis on the upheaval being unleashed by an artificial intelligence (AI) craze that is widely viewed as the biggest tectonic shift in technology since Apple co-founder Steve Jobs unveiled the first iPhone 18 years ago.
Apple rode the iPhone’s success to become the first publicly traded company to be valued at one trillion dollars, two trillion dollars and eventually three trillion dollars.
But there are concerns of a possible AI bubble, with officials at the Bank of England earlier this month flagging the growing risk that tech stock prices pumped up by the AI boom could burst.
The head of the International Monetary Fund (IMF) has raised a similar alarm.
The ravenous appetite for Nvidia’s chips is the main reason that the company’s stock price has increased so rapidly since early 2023.
On Wednesday the shares touched 207.86 dollars (£157.40) in early morning trading with 24.3 billion shares outstanding, putting its market cap at 5.05 trillion dollars (£3.82 trillion).
In comparison, Nvidia’s value is greater than the GDP of India, Japan and the United Kingdom, according to the IMF.
Nvidia chief executive Jensen Huang has downplayed concerns of a bubble bursting, saying that the generative AI chatbots that were merely “interesting” when they first took hold a few years ago are now becoming so useful that they will be profitable.
Mr Huang was heading to South Korea this week as leaders from major Pacific Rim economies, including the United States, China and Japan, are gathering for the annual Asia-Pacific Economic Co-operation (Apec) summit that has long championed free trade but is now confronting sweeping US tariffs on technology and other products.
The multilateral gathering in Gyeongju is expected to be overshadowed by a sideline event – a face-to-face meeting on Thursday between US President Donald Trump and Chinese leader Xi Jinping – as their intensifying trade war leaves the South Korean hosts in a difficult balancing act.
On Tuesday Mr Huang disclosed 500 billion dollars (£378 billion) in chip orders.
The company also announced a partnership with Uber on robotaxis and a one billion dollar (£757 million) investment in Nokia, with the two planning to work together on 6G technology.
In addition, Nvidia is teaming with the US Department of Energy to build seven new AI supercomputers.
Last month Nvidia announced that it will invest 100 billion dollars (£75 billion) in OpenAI as part of a partnership that will add at least 10 gigawatts of Nvidia AI data centres to ramp up the computing power for the owner of the artificial intelligence chatbot ChatGPT.
In August Mr Huang said Nvidia was discussing a potential new computer chip designed for China with the Trump administration.
Mr Trump said on Air Force One that he will speak to Mr Xi about Nvidia’s chips on Thursday on the sidelines of the Apec event that Mr Huang is also attending.
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