Nvidia (NVDA) stock is on track for a record high as investors continue to bet on an artificial intelligence boom, putting the chipmaker in the top spot as Wall Street’s most valuable company.
Shares rose over 3% in morning trading on Monday to top $138. Nvidia previously hit a record closing price of $135.58 in June.
Nvidia stock has risen sharply in October, at one point posting six consecutive days of gains.
The stock rose since October 2 after the announcement of a massive, 6.6 billion dollar funding round for ChatGPT-maker OpenAI. Most of that funding will be channeled back to Nvidia, as OpenAI’s growing energy demands require more AI chips.
Nvidia shares continue their upward trajectory, supported by a barrage of good news for the AI ​​chipmaker. Wall Street analysts last week reiterated a Buy rating on Nvidia stock. KeyBanc released a report estimating that Nvidia’s revenue from its new Blackwell chips will only reach $7 billion in the fourth quarter, while demand for older GPUs “remains very strong.” A potential new wave of funding for AI startups will also add to Nvidia’s coffers, Wedbush analysts said Tuesday.
Nvidia also showcased the strength of its software offering during the AI ​​Summit in Washington, DC The same day, Nvidia and Foxconn announced plans to build the largest supercomputer in Taiwan during Foxconn’s annual technology exhibition in Taipei. Foxconn also unveiled a mega-factory it is building to assemble Nvidia servers using Grace Blackwell chips in Mexico, reducing Nvidia’s reliance on China amid trade tensions.
Nvidia’s gains on Monday also came close to unseating Apple as the world’s most valuable company. The chipmaker’s market capitalization was $3.4 trillion as of Monday morning, while Apple’s was $3.5 trillion. Apple, Microsoft, and Nvidia have traded places as the top three companies over the past year.
Nvidia’s climb has reversed more than its previous decline following the company’s second-quarter earnings release.
Shares fell in late August after Nvidia failed to beat analyst expectations as much as investors had hoped. They fell further in a Bloomberg report that the company was subpoenaed by the US Department of Justice in early September, which Nvidia denied. Fears of an expected disruption from China, due to rising trade tensions with the US, also pushed stocks lower. Nvidia’s recent volatility has been magnified by its 10-to-1 stock split in June.
Another recent positive news in the semiconductor sector could help the rise of Nvidia. TSMC ( TSM ), one of Nvidia’s chipmakers, reported sales above Wall Street expectations — another indication that AI demand will remain strong in the near term.
“AI is hot,” Patrick Moorhead, CEO of Moor Insights and Strategy, told Yahoo Finance, adding, “I see continued growth in the AI ​​data center trade over the next 12 months.”
The chip sector is getting a signal that Big Tech’s massive spending on AI hardware isn’t over despite Wall Street fears of a slowdown.
Semiconductor industry sales rose 28% in August from a year earlier and 15% from July, according to the latest WSTS data reviewed by JPMorgan ( JPM ). Young Liu, chairman of server maker Nvidia Foxconn ( 2354.TW ), told Bloomberg Television in an interview Tuesday that the company is increasing capacity to meet “crazy” demand for Nvidia’s AI chips, or GPUs (graphics processing units). Nvidia CEO Jensen Huang said last week in a CNBC interview that demand for Nvidia’s latest Blackwell chip has been “not crazy.”
Nvidia is set to report earnings on November 19. Wall Street analysts expect the company to report revenue of $33 billion, up 82% from a year earlier, according to Bloomberg consensus estimates. About 90% of Wall Street analysts who cover the stock tracked by Bloomberg recommend buying Nvidia stock.
Laura Bratton is a Yahoo Finance reporter.
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
