Gain complimentary access to the Editor’s Digest
Roula Khalaf, the Editor of the Financial Times, curates her preferred stories in this weekly newsletter.
Nvidia’s stock reached an all-time high on Wednesday, bouncing back for the chip manufacturer after a challenging start to the year influenced by tensions between the US and China regarding vital AI technology.
The US-based chip maker’s shares climbed 4%, exceeding the previous record set in January. Nvidia has now overtaken Microsoft as the most valuable company globally, achieving a market capitalisation of $3.75 trillion compared to Microsoft’s $3.65 trillion.
This surge followed optimistic remarks from Nvidia’s CEO, Jensen Huang, at the company’s annual shareholder meeting, where he discussed the potential for continued significant growth for the next decade, emphasizing the “multitrillion-dollar opportunity” in AI and robotics.
“We are at the beginning of a decade-long expansion of AI infrastructure: the demand for national AI is rising globally,” Huang informed shareholders.
Fears that major tech firms like Microsoft and Amazon might reduce their extensive investments in AI infrastructure have eased. Recent earnings reports from these companies reaffirmed their dedication to these investments.
Nvidia had previously released a strong earnings report at the end of May, surpassing Wall Street’s predictions.
Earlier in the year, Nvidia’s stock faced a decline due to concerns about its leading position in the global AI infrastructure market after a breakthrough by China’s DeepSeek, which wiped nearly $600 billion from its market valuation.
The company was also affected after former US President Donald Trump imposed new limits on Nvidia’s H20 AI chips intended for China amid trade disputes.
This situation restricted Nvidia’s access to the Chinese market, which it estimates could reach $50 billion in subsequent years. Nvidia is contemplating redesigning its Blackwell chips to maintain market access to China while adhering to export regulations.
Daniel Newman, CEO of Futurum Group, remarked that the stock’s increase reflects Nvidia’s ability to innovate rapidly.
“Despite cloud providers like Amazon and Microsoft aiming to create their own integrated AI infrastructure, currently, Nvidia remains the best in the market,” he explained.
Concerns about competition from AMD for advanced AI chip market share seem irrelevant in the face of projected growth of a $400 billion market over the next four years.
Microsoft alone processed over five times the requests for AI models like ChatGPT last quarter compared to the same time last year, Huang informed shareholders on Wednesday.
Nvidia’s chip markets are also expanding, particularly with new AI companies providing access to top-tier AI chips. Shares of Nvidia-supported CoreWeave have skyrocketed over 300% since its Nasdaq listing in March, reflecting a return of investor confidence in AI’s long-term growth potential.
Nvidia has pledged to release AI chips annually and is preparing for the debut of Vera Rubin, following their latest Blackwell systems that have seen significant interest, including sovereign infrastructure contracts with Saudi Arabia and UAE.
Recently, Huang visited Gulf countries and Europe, announcing major deals while highlighting a new era of “accelerated computing” that promises enhanced productivity across various global industries.
“Nvidia is taking advantage of a general chip market revival,” stated G. Dan Hutcheson, a vice-president at TechInsights, noting that the market is bouncing back from the effects of Trump’s tariffs and the DeepSeek breakthrough. “Nvidia was previously underestimated as a result of both.”
