Nvidia surpasses Apple, becomes world’s second valuable company amid AI boom

Nvidia has overtaken Apple to become the world’s second most valuable company, with its market valuation surpassing $3 trillion. This surge is driven by a combination of a ten-for-one stock split effective June 7 and high demand for its AI processors. Nvidia’s stock jumped 5.2% to $1,224.40, raising its market value to $3.012 trillion, while Apple’s stock increased by 0.8%, bringing its market capitalisation to $3.003 trillion. Microsoft remains the most valuable company at $3.15 trillion.

Nvidia’s remarkable stock performance, surging 147% in 2024, reflects the booming demand for its processors from major tech companies like Microsoft, Meta Platforms, and Alphabet, all eager to enhance their AI capabilities. The company’s recent revenue forecast has further boosted its stock, adding nearly $150 million in market capitalisation in one day, exceeding the entire value of AT&T.

The PHLX chip index also saw a 4.5% rise, with companies like Super Micro Computer, which builds AI-optimised servers using Nvidia chips, benefiting from the AI optimism.

Nvidia’s CEO Jensen Huang, originally from Taipei, received extensive media coverage during his visit to the Computex tech fair in Taiwan, highlighting his influence and the company’s growing prominence.

In contrast, Apple is facing challenges with weak iPhone demand and stiff competition in China. Additionally, some investors view Apple as trailing behind in incorporating AI features compared to other tech giants. Despite Nvidia’s stock trading at 39 times expected earnings, it’s considered less expensive than a year ago, when it was over 70 times expected earnings, according to LSEG data.