Nvidia Corporation is on a trajectory to become the first semiconductor company to achieve a staggering $2 trillion valuation, as its shares closed at $1.97 trillion on Friday, briefly touching the $2 trillion mark during intraday trading.
The 0.4% rise in Nvidia’s shares solidifies its position as the world’s fourth-most valuable company, experiencing a remarkable 60% rally since the beginning of the year. The company’s market capitalization places it just behind industry giants Microsoft, Apple Inc., and Saudi Aramco.
While it took over two years for Apple and Microsoft to transition from $1 trillion to $2 trillion, Nvidia is on pace to accomplish this feat in less than a year, fueled by the growing enthusiasm on Wall Street for artificial intelligence (AI) technologies.
Nvidia’s stock received a significant boost following the announcement of exceptional financial results that reinforced Wall Street’s optimism about the potential of its AI technologies. The chipmaker provided guidance above expectations, citing increased AI spending from major clients, including Meta Platforms Inc.
The company’s dominance in the market for graphics chips tailored for complex computing tasks required to power AI applications positions Nvidia as a key player in the rapidly evolving landscape of AI development undertaken by various companies.
In its fiscal fourth quarter, Nvidia reported a remarkable 486% year-over-year gain in earnings per share, excluding certain items. Additionally, the company anticipates first-quarter revenue to reach approximately $24 billion, surpassing analyst estimates.
The positive financial outlook prompted an influx of bullish sentiment, with analysts rushing to raise their price targets. The average target now stands at about $863, implying a more than 9% upside, according to data compiled by Bloomberg.
