It is almost certain that Nvidia will soon join Wall Street’s most elite club due to its breathtaking surge Thursday. Shares of the chipmaker surged 26% on Thursday, bringing its market value to just under $1 trillion at approximately $950 billion, according to FactSet. As of Wednesday’s close, it stood at $755 billion. NVIDIA would become the fifth publicly traded U.S. company to have a market value of $1 trillion. Apple created the club in 2018. Microsoft, Google, and Amazon also hold the distinction. “Back in late 2021, we began publishing work suggesting Nvidia would become the first semiconductor company with a trillion dollar market cap,” Needham analyst Rajvindra Gill said in a note Thursday. “While there was some peaks and valleys in the interim years, we believe Nvidia is in a position to achieve that valuation over time.” That time could be as early as Thursday.
All eyes are on NVIDIA after it forecasted $11 billion in sales for the second quarter of its fiscal 2024 late Wednesday, citing demand for its graphics processors that power artificial intelligence applications like the ones at Google, Microsoft and ChatGPT maker OpenAI. That forecast blew away Wall Street and turned the AI hype driving the stock into real results. “Customers are ‘racing’ to meet large language models (LLMs) and generative AI based demand across all major modalities,” Gill added. “We see nearly all past headwinds behind us, and expect the company is shipping to true, AI-related demand, near-term.” Before Thursday’s session, the company’s shares had already gained 108% for the year. The shocking sales guidance from Nvidia – which was more than 50% over the $7.15 billion analysts expected – has catapulted the company’s market cap forward.