Nvidia Overtakes Apple as World’s Most Valuable Company—Is it too late to buy?

Ujjwal Maheshwari, October 31, 2024

When the whole world is looking to dig gold (profit from the operations of Artificial Intelligence), then supply the gold diggers (major tech companies) with a shovel (Artificial Intelligence chips). Artificial Intelligence is the new era in the technological landscape. Catering to this demand, Nvidia’s AI-powered GPU technology has become a fundamental component in sectors ranging from Artificial Intelligence (AI) to cloud computing.

In a significant leap in the global tech space, Nvidia recently became the world’s most valuable company surpassing Apple with a competitive edge. The market capitalization of Nvidia reached an impressive peak of $3.42 trillion and ended with a market value $3.42 trillion, while Apple’s valuation stood very close but ended with a slightly less rate of $3.55 trillion. Nvidia concluded the day with an increase of 0.8%, while Apple’s shares rose 0.4%.

Nvidia has been through an immense transformation that shaped their offerings for the technological race. The company in the past five years saw a giant leap of 2691.5% rise in their market cap. Nvidia’s revenue for the first quarter of 2025 was a record $26 billion, which was an 18% increase from the previous quarter and a significant 262% increase from the previous year. The company is expected to reach a $28 billion (plus or minus 2%) as revenue for the second quarter of fiscal 2025. With a proven track record of a company like Nvidia, is now the perfect time to buy in, or has the best opportunity already passed?

Growth of Nvidia: How Nvidia tapped into the demand for GPUs and served the AI boom

It’s almost like Nvidia had a great foresight about this ongoing advancement in AI. The company is a crucial player in the production of semiconductor chips that power the AI revolution. Partnering with many companies and countries, Nvidia is assisting the shift of trillion-dollar traditional data centers into accelerated computing by building efficient AI factories to provide the inevitable service called ‘Artificial Intelligence.’

The FY24 for the tech giants has been nip and tuck with Microsoft, Apple, and Nvidia showing consistent growth in their market valuation. The need to incorporate the operations of AI in various businesses can be understood by these key highlights of FY24 for the major players in the technological industry:

The market cap of Apple for FY24 saw a rise of 37.22%.
With a 43.79% increase for the fiscal 2024, Amazon stands close to this race.
Microsoft saw a 28.06% increase in their market cap and its market value stood at $3.18 trillion with its stock up 0.8%.

The companies are tremendously working to get ahead in the AI race because digging into AI only seems to give bigger opportunities and a chance to expand the performance of computing to advanced levels.

Nvidia’s tool of the trade

Artificial Intelligence requires more sophisticated and complicated mechanisms to perform computations. Nvidia’s signature A100 and H100 models have become completely essential for developing AI models. GPT-4, a world-class AI model developed by OpenAI, is essentially powered by Nvidia. For various complicated processes associated with AI like Natural Language Processing (NLP), Computer Vision (CV), and other miracles, Nvidia is building supercomputing chips specifically optimized for AI applications

These high-grade GPU chips enhance the speed of the model and significantly reduce the latency associated with it. A lot of companies are focused on the research and development of AI in various industries to help achieve faster progress. Nvidia is providing the necessary ammunition to these companies, and thus, Nvidia stands at the forefront of AI innovation and providing the vehicle to other companies looking to explore the space of AI.

Nvidia’s expertise in other utilities

Nvidia is currently in alliance with various IT giants to create thousands of jobs, thereby contributing to the employment statistics. The company is involved in building smarter AI virtual assistants to transform customer services across every major industry. Developers can start their Generative AI (the visionary cousin of traditional AI) journey by utilizing the NIM Agent blueprints offered by Nvidia.

Nvidia has also announced complicated initiatives for weather prediction to create a sustainable environment. The company’s AI-powered chips are now accelerating gaming experiences for gamers worldwide. Nvidia offers the lowest latency possible for games because their chips are designed to handle complex processes. Vital players in the automotive industry are now partnering with Nvidia to power next-generation vehicles. The company is not only developing a diverse range of sectors but also powers the companies’ core offerings to the people.

Nvidia has developed a great deal of software frameworks such as TensorRT (inference enhancement) and cuDNN (CUDA Deep Neural Network library) specifically designed for deep learning. This enables developers to run AI models more efficiently with reduced latency on Nvidia hardware setup. Nvidia has also provided the domain of Augmented Reality (AR) with vital contributions. Nvidia’s DGX Systems provide high-performance data center solutions optimized particularly for AI and HPC (High-Performance Computing). Nvidia’s infrastructure is currently the foundational base for every company looking to develop faster AI models.

Nvidia’s DRIVE platform includes a complete hardware and software stack for self-driving cars, which utilize powerful GPUs and AI models to interpret data from built-in sensors and cameras in real-time. Nvidia’s Omniverse is a collaborative 3D design platform that enabled teams to work in real-time across software tools and thereby effectively contributing to projects. With prominent applications in films, architecture, and video game rendering, Omniverse supports high-quality AI-driven interactions.

Nvidia’s historical feat

CNBC has stated, “Nvidia, the pioneer of accelerated computing, is the driving force of this new era.” By this virtue, Nvidia’s past performance can be a potential way to understand the company’s performance and contribution to the technological industry. The company’s revenue for 2024 reached a great height of $60.9 billion, which is a 126% increase from its previous year. And their operating income was up by 681% year on year and touched $33 billion for FY24.

Here’s a breakdown of their revenue with regards to their expertise:

Accelerated data centers showed $47.5 billion in revenue, which is a 217% increase from the previous year.
Gaming and creatives – The company stated $10.4 billion in revenue, which is a 15% rise year on year.
Enhancing automotive services – With a 21% rise year on year, Nvidia saw a $1.1 billion revenue.

he company’s extensive track record is a compelling way for investors to consider Nvidia for their investment portfolio. For a long time, Nvidia has established itself as a key player in the growth of AI. What it now became is the giant that supplies industries with powerful, most-efficient tools, essentially high processing chips, to develop the virtues of AI. So naturally, Nvidia is now an attractive entity in the stock market. Reaching the market capitalization of $3.42 trillion is beyond exceptional. Nvidia was able to achieve that while in a neck and neck edge with other major tech giants, including Microsoft and Apple.

Is it too late?

Nvidia has positioned itself at the heart of AI development and deployment. The company has been continuously transforming various industries like automotive, gaming, healthcare, and environmentally sustainable practices. The company is both involved in AI research and advancement all while lending a crucial hand to other companies venturing into the world of AI.

Nvidia has successfully created a synergy of hardware and software offerings which could potentially sustain their current dominance in this sector. With their super powerful AI chips, Nvidia is considered a super force that leads the world into a more progressive and efficient space, especially with AI. So, considering these essential factors, Nvidia now stands as a great opportunity for investors who are looking to capitalize on the trends in AI.

Possible challenges to look out for

Since there is a huge AI-driven sentiment among the investors with technological background, there can be risks of short market volatility. Any setbacks in the AI sector could potentially drag Nvidia’s current rise to unexpected downturns. This includes a possibility of dampened down need for GPUs.

Nvidia is also at a crucial edge with more competitive forces rising. Certain players like Intel and AMD are now creating their signature AI-focused chips that can possibly pull the attention of major tech companies in this sector. However, Nvidia is driving the AI revolution with their consistent performance and innovative solutions.

Final thoughts on Nvidia

In light of these facts, Nvidia is dominating the AI-powered solutions in this sector, and as a testament to that, Nvidia reached a record high in their market capitalization, thereby emerging as the most valuable company in the market. While evaluating this company, it is essential to weigh the risk appetite of the investor against the company’s future potential.

For investors with exceeding confidence in the AI’s future, Nvidia remains a strong contender in the tech space. However, for investors concerned with potential market volatility, it might be a wise move to wait a beat and watch the company’s performance in the upcoming quarters to see if it sustains its current growth record. Follow more about Nvidia’s performance and industry trends to get a wider perspective of the economic factors at play. This can help investors make informed investment decisions.