Nvidia becomes world’s most valuable company amid AI boom

The share price of the chip maker has risen more than 3,000 per cent over the last five years

AI robots pictured on stage at a keynote address during the Nvidia GTC Artificial Intelligence Conference on 18 March, 2024 in San Jose, California (Getty Images)

Computer chip maker Nvidia has overtaken Microsoft to become the world’s most valuable company.

The share price of the US firm hit a new record high on Tuesday, having more than doubled since the start of the year.

The remarkable rise coincides with a huge surge in demand for computer chips from companies developing artificial intelligence systems.

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Nvidia grabbed the top spot on Wall Street from Microsoft, which has been trading the crown back and forth with Apple after they wrested it from past titans like Exxon Mobil and cigarette-maker Philip Morris.

Microsoft and Apple were at the vanguard of Big Tech, which is the dominant force in the US stock market, after amassing strength through the digitisation of the world. Nvidia is riding the wave of a more specific tech surge, this time in artificial intelligence.

Nvidia’s chips are helping to develop AI, which proponents expect to change the world as much or more than the internet, and demand for its chips has proven to be shockingly voracious.

Nvidia’s revenue routinely triples every quarter, and its profit is rocketing at even more breathtaking rates. Its stock is up nearly 174 per cent this year, and Nvidia alone was responsible for nearly a third of the S&P 500’s entire gain for the year through May.

Over the last five years, Nvidia’s share price has risen more than 3,000 per cent, taking its overall market cap above $3.3 trillion.

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Other US tech firms have also experienced significant gains in recent months, albeit slightly more modest than those of Nvidia.

The top five most valuable companies in the world are now all based in either Silicon Valley or Washington State.

Additional reporting from agencies.