Nvidia rallies to $1.9 trillion on AI surge, making founder and CEO Jensen Huang the world's 21st richest person

News
By Anton Shilov
published

Nvidia's stock gains on rising demand for AI processors.

Nvidia
(Image credit: Nvidia)

After posting record financial results for the year and the quarter as well as providing guidance that beats expectations of financial analysts, Nvidia's added $250 billion to its stock market value, the largest single-day gain ever on Wall Street, reports Reuters. As a result, Jensen Huang, chief executive of Nvidia, has seen his wealth soar by $8.5 billion to $68.1 billion, placing him 21st on the Bloomberg Billionaires Index. 

The surge came after Nvidia's quarterly report exceeded expectations, with its stock rising 15% to $774.18 and its market cap surpassing $1.9 trillion. The company's impressive performance was driven by strong demand for its AI and HPC GPUs as well as graphics cards for gaming and professional visualization applications, making it the third most valuable company in the U.S. stock market (after Microsoft and Apple) and the fourth most valuable company in the world (after Microsoft, Apple, and Saudi Aramco). 

Nvidia's growth is attributed to the soaring demand for Nvidia's processors as the world's largest high-tech companies (including large cloud service providers like Microsoft, Google, Meta, and others) rush to enhance their AI compute capabilities. Despite concerns about the impact of U.S. restrictions on chip sales to China, Nvidia's dominance in the high-end AI processor market remains unchallenged, controlling about 80% of the market. 

As a result of Nvidia's gains, Jensen Huang, a co-founder and the CEO of Nvidia, has seen his wealth increase by $8.5 billion to $68.1 billion, which made him the world's 21st richest individual, according to the Bloomberg Billionaires Index. Nvidia's growth has propelled Huang ahead of notable figures like Charles Koch, CEO of Koch industries, and Zhong Shanshan, one of the wealthiest businessmen in China. The company's success has also benefited other billionaires in the technology sector, with the fortunes of 28 billionaires linked to AI increasing by a combined $35.7 billion, notes Bloomberg. 

Nvidia's stock has seen a 57% increase in 2024, significantly contributing to the S&P 500's gains. However, some analysts and investors are cautious about the rapid pace of these gains. Following the earnings report, numerous brokerages raised their price targets for Nvidia, with Rosenblatt Securities setting one of the most optimistic targets at $1,400, according to Reuters.

Anton Shilov
Anton Shilov
Freelance News Writer

Anton Shilov is a Freelance News Writer at Tom’s Hardware US. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

14 Comments Comment from the forums
  • vanadiel007
    Always have to watch for over valuation. It can turn ugly quickly if you don't manage to meet expectations of Wall street specialists.
    Reply
  • scrumpydrew
    vanadiel007 said:
    Always have to watch for over valuation. It can turn ugly quickly if you don't manage to meet expectations of Wall street specialists.
    Are we in a machine-learning bubble?
    Reply
  • Order 66
    scrumpydrew said:
    Are we in a machine-learning bubble?
    If we are, I don’t see an end to it. At least with the crypto bubble , we knew that Etherum was moving to proof of stake, but with AI/ML, there are so many practical applications, I don’t see an end to it.
    Reply
  • toffty
    Order 66 said:
    If we are, I don’t see an end to it. At least with the crypto bubble , we knew that Etherum was moving to proof of stake, but with AI/ML, there are so many practical applications, I don’t see an end to it.
    QFT
    I know there are many on here that say "ai sucks" or "who needs ai" to basically every thread about it

    The issue? It's an exponential technology and unlike hardware that has a doubling time of 12-24 months, AI's is closer to 6 months.

    We're still at the start of this AI generation/revolution and it is going to be profound for everyone's lives.

    I doubt it'll be driven off nVidia or amd graphics forever but for now, this will continue.
    Reply
  • Order 66
    toffty said:
    QFT
    I know there are many on here that say "ai sucks" or "who needs ai" to basically every thread about it

    The issue? It's an exponential technology and unlike hardware that has a doubling time of 12-24 months, AI's is closer to 6 months.

    We're still at the start of this AI generation/revolution and it is going to be profound for everyone's lives.

    I doubt it'll be driven off nVidia or amd graphics forever but for now, this will continue.
    Maybe I’m misunderstanding, (I think you’re saying that I think AI sucks) but I think AI is great, a bit flawed for the moment, but the potential is huge.
    Reply
  • Co BIY
    vanadiel007 said:
    Always have to watch for over valuation. It can turn ugly quickly if you don't manage to meet expectations of Wall street specialists.

    I can see overvaluation happening if the market is as big as anticipated but Nvidia can't produce enough to capture the value or has to share a large part of the profits with it's fab partners reducing profitability.
    Reply
  • refillable
    Order 66 said:
    If we are, I don’t see an end to it. At least with the crypto bubble , we knew that Etherum was moving to proof of stake, but with AI/ML, there are so many practical applications, I don’t see an end to it.
    The internet has so many practical applications, but that didn't stop the dotcom bubble.

    Usefulness is not a good justification for emerging technologies' exaggerated expectations.
    Reply
  • Notton
    I think AI has nearly unlimited potential right now, so it's not a bad investment.
    The only way it's going to slow or stop, is if government does something about it.

    I don't think we'll see a fully AI driven car for another 15~20yrs, but I can easily see AI being used in number crunching jobs. I read that one of the first jobs speculated for AI takeover is at banks.
    I eagerly await the day when someone lets AI play on the stock market. I think the results are going to be hilarious.
    Reply
  • toffty
    Order 66 said:
    Maybe I’m misunderstanding, (I think you’re saying that I think AI sucks) but I think AI is great, a bit flawed for the moment, but the potential is huge.
    No not you. I am referring to those that truly believe that deep learning AI is pointless. It is flawed in many regards rn (depend on the model), sure. It also is not "general ai" which many assume ai must be before it's "good"

    What I am frustrated about is the inabity for many on even a tech website to not full grasp what 6 month doubling times mean and how profoundly fast ai is capable of growing in the near future.
    Reply
  • Order 66
    refillable said:
    The internet has so many practical applications, but that didn't stop the dotcom bubble.

    Usefulness is not a good justification for emerging technologies' exaggerated expectations.
    That was the exact counter point that I knew someone would mention. I agree with you completely, but the question now is, is AI/ML really overhyped and overvalued to the point of being a bubble? I’m not sure.
    Reply