Nvidia has achieved a significant milestone, rising from a small video game processor company to a key player in the artificial intelligence sector. On Tuesday, the company’s stock reached a valuation of $5 trillion, reflecting an increase of over 50% this year. This surge follows comments from Nvidia’s CEO Jensen Huang, who indicated expectations of $500 billion in AI chip orders and announced plans for seven new supercomputers for U.S. government agencies. Additionally, Nvidia revealed on Tuesday its intention to invest $1 billion in Nokia as part of a strategic alliance focused on developing next-generation 6G mobile technology. U.S.
stocks, driven by the AI boom, hit record levels on Tuesday, with all major indexes benefiting from the rise in tech stocks. Notably, Apple and Microsoft both surpassed a market value of $4 trillion as their shares rose. This remarkable growth in U.S. stocks occurs despite ongoing concerns about a potentially inflated stock market, particularly since AI-related spending has led to unprecedented sales and valuations. Recently, the International Monetary Fund and the Bank of England warned that the global semiconductor industry could face risks if investor enthusiasm for AI declines. Ark Invest CEO Cathie Wood expressed skepticism about the immediate future of AI valuations, suggesting the possibility of an AI bubble.
“If our expectations for AI are correct, we are at the very beginning of a technology revolution,” Wood stated to CNBC ahead of Saudi Arabia’s Future Investment Initiative in Riyadh.