AI's explosive growth has finally consolidated Nvidia as the world's largest company
Nvidia has become the world's most valuable company with a market capitalization of $3.43 trillion, surpassing Apple. The company has largely addressed investor concerns that triggered a previous fall in its shares, as it continues to be the main beneficiary of the AI boom.
Nvidia's market capitalization rose to $3.43 trillion this Tuesday after its stocks rose 2.9% to $139.93, surpassing Apple's $3.38 trillion capitalization at market close. Previously, Nvidia briefly held the title of the world's largest company after overtaking Apple this June, although that feat didn't last more than 24 hours. Nvidia being now the largest company in the world confirms, yet again, that the company has benefitted the most from AI's ever-increasing infrastructure demands. But more importantly, analysts also take this event to signal that the 'AI boom' is far from over.
Although Nvidia has enjoyed remarkable growth, 850% since the end of 2022, it has also faced some roadblocks during its journey. This August, Nvidia's shares fell as much as 7% in pre-market trading after investors saw signs of slowed growth due to production issues as Nvidia announced delays in its new Blackwell chips deliveries. Some of these concerns have also driven foundation model developers and tech giants to look for alternatives to their reliance on Nvidia for their computing infrastructure needs.
Nvidia has since taken action to address investor concerns. Last month, Foxconn, an Nvidia supplier, and the world's largest contract electronics manufacturer, announced it will set up the world’s largest factory for GB200 Blackwell AI server assembly in Mexico. "The demand is awfully huge," said Foxconn senior vice president Benjamin Ting, referring to the Blackwell platform. Details on the project are scarce, but the news is an unequivocal statement that Nvidia is pulling all the stops to keep up with demand and meet delivery deadlines, while strategically taking its manufacturing processes out of China and closer to the US.
