Nvidia adds $330 Billion in historic daily market value gain

Nvidia, a California-based chip maker, has achieved the largest single-day increase in market value in Wall Street history. On Wednesday, Nvidia added $330 billion to its market capitalisation, surpassing its previous record of a $277 billion gain set in February.

The company’s shares surged nearly 13 percent, driven by expectations of continued strong demand for its chips. This followed Microsoft’s announcement on Tuesday that AI-related capital spending for the 2024 fiscal year had risen 60 percent to $69 billion.

With this latest rally, Nvidia’s market cap has reached $2.88 trillion, positioning it as the world’s third most valuable company, following Apple and Microsoft. Nvidia, whose graphics processing units (GPUs) are crucial for AI development, briefly became the world’s most valuable company in June, surpassing Microsoft with a market cap of $3.335 trillion.

Over the past year, Nvidia shares have increased by more than 150 percent, outpacing any other major US company. Despite this growth, the company has experienced significant volatility; just a day before the latest rally, shares dropped 7 percent, reducing the company’s value by $193 billion.

Founded in 1993 with a focus on 3D graphics for gaming, Nvidia’s success took off when it started developing GPUs for other applications in the 2000s. Now, fueled by high demand from tech giants like Microsoft, Meta, and Google, Nvidia controls about 80 percent of the market for chips used in data centers that run AI models.

Nvidia went public in 1999, with shares trading at $12 each. An investor who purchased 100 shares at that time for $1,200 would now own stock worth over $5.6 million.