Nvidia Becomes World’s First $5 Trillion Company Amid AI Boom

Nvidia’s stock increased by over 3% on Wednesday, making the tech giant the first to cross the $5 trillion market value threshold.

From a specialized manufacturer of video game processors to an important player in the artificial intelligence explosion, the company has had a spectacular ascent, which is reflected in this astounding milestone.

Despite closing Tuesday’s trading session up 5%, Nvidia’s stock has increased by over 50% so far this year.

The most recent increase follows CEO Jensen Huang’s announcement that Nvidia expects $500 billion in orders for artificial intelligence chips and that the company will build seven new supercomputers for the US government.

In a separate announcement on Tuesday, Nvidia said it was acquiring a $1 billion stake in Nokia in order to establish a partnership with the networking company to develop 6G cellular technology.

The AI trade propelled U.S. stocks to all-time highs on Tuesday. Gains in technology helped the major averages; once their shares increased, Apple and Microsoft each had market values of over $4 trillion.

Even still, there are still worries about a bubble, especially because AI-driven spending has resulted in record acquisitions and valuations.

The Bank of England and the International Monetary Fund were the most recent financial organizations to issue warnings earlier in the month that if investor interest in AI wanes, the world’s stock markets may be in trouble.

Cathie Wood, the CEO of Ark Invest, raised concerns about an AI bubble on Tuesday but also pointed out the possibility for a “reality check” on AI valuations in the near future.

“We are at the beginning of a technology revolution if our expectations for AI are correct,” Wood told CNBC in Riyadh during Saudi Arabia’s Future Investment Initiative.