In a landmark move, Nvidia has skyrocketed to the $3 trillion valuation mark, surpassing Apple to claim the title of the world's second-most valuable company.
This surge comes as Nvidia prepares to split its stock ten-for-one on June 7, making it even more attractive to individual investors. The company's stock climbed 5.2% to close at $1,224.40, pushing its market cap to an impressive $3.012 trillion. Meanwhile, Apple saw a modest rise of 0.8%, ending at $3.003 trillion.
Despite Nvidia's rise, Microsoft remains the world's most valuable company with a valuation of $3.15 trillion after its shares increased by 1.9%.
Jake Dollarhide, CEO of Longbow Asset Management, commented on the trend: \"Nvidia is making money on AI right now, and companies like Apple and Meta are spending on AI. It may be a foregone conclusion that Nvidia will overtake Microsoft as well. There's a lot of retail money that's piling in on what they see as a straight shot up.\"
Nvidia's stock has already surged 147% in 2024, driven by soaring demand for its top-tier processors. As giants like Microsoft, Meta Platforms, and Alphabet race to enhance their AI capabilities, Nvidia stands out as a key player in the tech race.
On the flip side, Apple is facing challenges with weak iPhone demand and stiff competition in China, the world's largest smartphone market. Investors are also noting that Apple is trailing behind other tech heavyweights in integrating AI features into their products and services.
Analysts are optimistic about Nvidia's future earnings, with the company currently trading at 39 times expected earnings—a significant improvement from over 70 times a year ago, according to LSEG data.
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