Nvidia Briefly Tops Apple in Race to $4 Trillion Valuation

Soaring AI Demand Fuels Rally

Shares of Nvidia surged as much as 2.4% on Thursday, lifting its intraday market capitalization to $3.92 trillion. Investors have doubled down on the company’s leading position in AI chip design, driving optimism across Wall Street. Morning trading saw Nvidia climb past Apple’s December 2024 all-time high of $3.915 trillion, before settling near $3.89 trillion by day’s end. That figure left the chipmaker just shy of the record but on the cusp of making history as the most valuable company ever.

Nvidia’s Santa Clara headquarters has become the epicenter of AI hardware innovation. Its latest GPUs, including the Blackwell series, have accelerated the training of the largest language and reasoning models, prompting hyperscalers to pour capital into Nvidia-powered data centers. Major cloud providers such as Microsoft, Amazon and Meta are locked in fierce competition to build next-generation AI infrastructure, swelled by Nvidia’s performance edge.

Market Cap Milestones and Comparisons

A rapid climb from $500 billion in 2021 to nearly $4 trillion today has transformed Nvidia from a gaming-GPU specialist into Wall Street’s AI bellwether. The company now eclipses the combined value of the Canadian and Mexican stock markets, while also outweighing every publicly listed firm in the United Kingdom. Microsoft sits in second place on the leaderboard with a $3.7 trillion valuation, followed by Apple at $3.19 trillion, marking a reshuffled hierarchy among Big Tech.

Valuation metrics underscore investor confidence. Nvidia trades at roughly 32 times forward earnings—below its five-year average of 41—reflecting analysts’ steadily rising profit forecasts that have kept pace with the stock’s surge. Rebounding more than 68% from an April low triggered by global tariff fears, Nvidia’s shares have recovered on renewed expectations that U.S. trade policies will stabilize.

Risks and Future Outlook

Although enthusiasm remains high, cautionary voices remind investors that lofty valuations carry risk. Short-seller Jim Chanos has likened the AI euphoria to the dot-com era, warning that companies can quickly slash capital expenditures if the AI spending wave recedes. Similarly, Bokeh Capital Partners’ Kim Forrest questions whether current large-model deployments will ultimately live up to hype.

Global supply-chain constraints also pose hurdles. Nvidia relies on third-party foundries in Taiwan for chip fabrication, leaving it vulnerable to geopolitical tensions and export controls. Meanwhile, the emergence of lower-cost AI solutions—exemplified by Chinese startup DeepSeek—has already sparked brief market sell-offs, though major corporate clients so far remain committed to Nvidia’s premium offerings.

Additional volatility may arise as hyperscalers and some tech giants develop in-house AI accelerators to complement or replace GPUs. Yet Nvidia’s entrenched software ecosystem—centered on CUDA and a broad array of AI toolkits—continues to deepen customer lock-in, making any large-scale migration a daunting undertaking.