Nvidia Overtakes Apple A New Leader in Market Value

Nvidia has officially dethroned Apple as the world’s most valuable company, achieving this milestone on Friday after a remarkable surge in its stock price driven by soaring demand for its cutting-edge supercomputing AI chips. At one point, Nvidia’s market value soared to an impressive $3.53 trillion, just edging out Apple, which was valued at $3.52 trillion, according to data from LSEG.

Overview

Historic Shift

Nvidia has overtaken Apple as the world’s most valuable company, with its stock market value briefly reaching $3.53 trillion, compared to Apple’s $3.52 trillion.

Stock Surge

This milestone was achieved following a significant rally in Nvidia’s stock, driven by an increasing demand for its supercomputing AI chips.

Competitive Landscape

In June, Nvidia had briefly held the title before being surpassed by Microsoft and Apple. The valuations of these tech giants have been closely intertwined, with Microsoft’s market value at $3.20 trillion.

October Performance

Nvidia’s stock has risen approximately 18% in October alone, with momentum building after OpenAI announced a $6.6 billion funding round. Nvidia’s chips are essential for training AI models like GPT-4.

Strong Demand for AI Chips

Investment director at AJ Bell, Russ Mould, emphasized the strong and growing demand for Nvidia’s chips as more companies adopt AI technologies.

Impact of TSMC’s Earnings

Nvidia’s rally was further supported by TSMC’s (Taiwan Semiconductor Manufacturing Company Limited) impressive quarterly profit report, which highlighted a 54% jump in profits due to high demand for AI-related chips.
Nvidia is set to report its third-quarter results in November, having previously forecasted revenue of $32.5 billion, which aligns closely with analyst expectations.

Long-term Outlook

Morgan Stanley analyst Joseph Moore remains optimistic about Nvidia’s long-term prospects but notes that the recent stock rally raises expectations for upcoming earnings.
After discussions with Nvidia’s CEO, Moore noted a strong ramp-up in production of next-generation Blackwell chips, which are booked out for the next 12 months.

Market Influence

The combined weight of Nvidia, Apple, and Microsoft significantly affects the technology sector and the broader U.S. stock market, accounting for roughly 20% of the S&P 500 index.
Investor enthusiasm surrounding AI advancements, coupled with expectations of reduced interest rates from the U.S. Federal Reserve, has contributed to a surge in the S&P 500, reaching an all-time high.
Nvidia’s stock has become popular among options traders, making it one of the most frequently traded stocks in this market segment in recent months.

Year-to-Date Performance

Nvidia’s shares have skyrocketed nearly 190% this year, fueled by a surge in generative AI and a series of strong financial forecasts.

Investor Sentiment

Rick Meckler, a partner at Cherry Lane Investments, raised concerns about the sustainability of revenue streams, suggesting that market sentiment might be driving stock performance more than fundamental proof of AI’s long-term viability.

Summary/Static	Details
Why in the news?	Nvidia has officially dethroned Apple as the world’s most valuable company
Stock Surge	Nvidia’s stock price surged due to increasing demand for its supercomputing AI chips.
Competitive Landscape	In June, Nvidia briefly held the title before being surpassed by Microsoft and Apple. Microsoft’s market value is at $3.20 trillion.