What you need to know
- NVIDIA is now the second most valuable company in the world, ahead of Apple, and has over $3 trillion in market capitalization.
- The chip maker’s success can be attributed to the rising demand for GPUs to foster AI advances.
- Apple will reportedly join the AI fray during WWDC 2024 and integrate cutting-edge technology across its devices to compete with Microsoft on an even playing field.
Every major tech corporation dabbling with artificial intelligence seems to be reaping big benefits. At the beginning of this year, Microsoft became the world’s most valuable company, with over $3 trillion in market valuation ahead of Apple. Now, NVIDIA has surpassed Apple to become the second most valuable company in the world.
NVIDIA’s market cap hit $3 trillion on Wednesday after its shares rose by over 5% and ended the day at $1,224.40. The chip maker’s market capitalization currently sits at $3.01 trillion—a few hundred million behind Apple’s $3.00 trillion market capitalization.
Apple is seemingly lagging because of its reservations about investing and integrating cutting-edge technology into its ecosystem. However, in return, early investors and adopters of AI, such as Microsoft, are potentially on the verge of hitting their iPhone moment with AI ahead of Apple.
The chip maker’s rise to the ranks and surpassing Apple isn’t entirely surprising, as it was just a few hundred million behind Apple last week.
According to Longbow Asset Management CEO Jake Dollarhide (via Reuters):
“Nvidia is making money on AI right now, and companies like Apple and Meta are spending on AI. It may be a foregone conclusion that Nvidia will overtake Microsoft as well. There’s a lot of retail money that’s piling in on what they see as a straight shot up.”
NVIDIA’s stock has gone up 147% in 2024 (so far) and will likely continue with the increasing demand for GPUs to foster AI advances. However, Microsoft and OpenAI have reportedly invested over $100 billion in a project dubbed Stargate that could potentially free them from an overreliance and dependence on NVIDIA for AI chips.
Apple held the world’s most valuable company title, but this has seemingly changed. The changes can be attributed to the company’s reluctance to join the AI fray and the iPhone’s depressed sales, especially in the Chinese market.
Interestingly, Apple and OpenAI reportedly struck a deal to bring the hot startup’s AI technology to the iPhone, a move that has raised concern for OpenAI’s largest investor, Microsoft. Microsoft is among OpenAI’s early supporters, with a 49% stake after making a multi-billion dollar investment.
While details around the Apple-OpenAI partnership remain slim, ChatGPT will reportedly make its way to the iPhone, potentially replacing the dated Siri. Like Microsoft’s Copilot+ PC requirement for its new next-gen AI features, Apple’s new AI features shipping to the iPhone will only work on the iPhone 15 Pro or later. It would be interesting to see if Apple could retrace its steps and reclaim the world’s most valuable company title.