NVIDIA: what if the GPU giant became the world’s largest company by market capitalization?

Mathilde Rochefort

January 29, 2024 at 3:02 p.m.


Nvidia headquarters logo © Chung-Hao Lee / Shutterstock.com

NVIDIA has seen its profits rise drastically thanks to the boom in generative AI. © Chung-Hao Lee / Shutterstock.com

NVIDIA begins the year 2024 as it ended 2023: in great shape. During the month of January, the capitalization of the graphics card giant continued to climb.

NVIDIA is considered one of the big winners in the race for generative artificial intelligence (AI) democratized by ChatGPT. Its GPUs, and more particularly the H100, happily dominate the AI ​​accelerator market, and almost exclusively power large generative AI models like GPT-4. As a result, the company saw its valuation explode by 240% in 2023. It even exceeded $1,000 billion, allowing it to join the global elite, alongside behemoths like Apple, Amazon, Google and Microsoft.

Jump start

The processor maker also got off to a hot start in 2024, adding nearly $128 billion to its market capitalization. This represents an unprecedented gain in value for NVIDIA.

At CES 2024, the company introduced three new PC graphics cards, to enable users to better use AI on their personal devices. This announcement further boosted investor confidence, with NVIDIA forecasting to see its growth climb until at least 2025.

If its profits continue to increase exponentially, there is no doubt that the company’s capitalization will follow. It should therefore continue to grow during the year, even if it means getting closer to those of Apple or Microsoft.

GPU H100 © The GPU H100, currently used by Microsoft for its data centers © NVIDIA

The H100 GPU. © NVIDIA

Generative AI is turning heads on Wall Street

The Redmond firm’s valuation recently surpassed that of Apple, crossing the threshold of $3,000 billion. Here too, generative AI has something to do with it. Analysts even estimate that this trend should continue over the next five years. For the moment, NVIDIA’s is “only” $1.5 trillion, but its room for growth is still significant, while more and more companies are launching into generative AI, still requiring a increased computing power.

The only downside is that American restrictions on AI chips to China could hamper its progress. The Middle Kingdom indeed represents a colossal market for the company, but Washington refuses to allow its most developed processors to be sent there.

NVIDIA is expected to soon share its financial results for the final quarter of 2023, providing insight into its forecasts for the new year ahead.

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Source : Bloomberg

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