Nvidia (NVDA) stock is on track to hit an all-time high as investors continue to bet on the artificial intelligence boom, allowing the chipmaker to compete for the top spot as Wall Street’s most valuable company.
Shares rose more than 3% Monday morning to above $138. Nvidia previously reached a record closing price of $135.58 in June.
Nvidia shares rose sharply in October, at one point posting six consecutive days of gains.
The stock’s rise began on October 2 following the announcement of a massive $6.6 billion funding round for ChatGPT maker OpenAI. Much of that funding will flow back to Nvidia, as OpenAI’s growing energy needs will demand more of its AI chips.
Nvidia shares continue their upward trajectory, fueled by a barrage of good news for the AI chipmaker. Wall Street analysts reiterated their Buy ratings on Nvidia stock last week. KeyBanc released a report estimating that Nvidia’s revenue from its new Blackwell chips alone will reach $7 billion in the fourth quarter, while demand for its older GPUs “remains extremely robust.” A potential new wave of funding for AI startups would also boost Nvidia’s coffers, Wedbush analysts said Tuesday.
Nvidia also demonstrated the power of its software offering at the AI Summit in Washington, DC. The same day, Nvidia and Foxconn announced plans to build Taiwan’s largest supercomputer at Foxconn’s annual technology showcase event in Taipei. Foxconn also provided details of a mega-factory it is building to assemble Nvidia servers using its Grace Blackwell chips in Mexico, reducing Nvidia’s dependence on China amid heightened trade tensions.
Nvidia’s gain on Monday also brought it closer to dethroning Apple as the world’s most valuable company. The chipmaker’s market cap was $3.4 trillion as of Monday morning, while Apple’s was $3.5 trillion. Apple, Microsoft and Nvidia have swapped places as the three largest companies in the past year.
Nvidia’s rise has more than reversed previous declines following the company’s second-quarter earnings release.
Shares fell in late August after Nvidia failed to exceed analyst expectations as much as investors had hoped. They were further struck by a report from Bloomberg that the company had been subpoenaed by the US Department of Justice in early September, which Nvidia denied. Fears of demand disruptions from China due to rising trade tensions with the US had also driven shares lower. Nvidia’s recent volatility has been amplified by its 10-to-1 stock split in June.
Other recent positive news in the semiconductor sector could fuel Nvidia’s rise. TSMC (TSM), one of Nvidia’s chip makers, reported revenue above Wall Street expectations – another indication that demand for AI will remain strong in the near term.
“AI is hot,” Patrick Moorhead, CEO of Moor Insights and Strategy, told Yahoo Finance. He adds: “I foresee continued growth in the AI data center trade over the next twelve months.”
The chip sector’s gains indicate that Big Tech’s massive spending on AI hardware is far from over, despite Wall Street fears of a slowdown.
Semiconductor industry sales rose 28% in August from the previous year and 15% from July, according to the latest WSTS data reviewed by JPMorgan (JPM). Young Liu, the chairman of Nvidia’s server maker Foxconn (2354.TW), told Bloomberg Television in an interview on Tuesday that the company is increasing capacity to meet “crazy” demand for Nvidia AI chips, or GPUs (graphics processing units). Nvidia CEO Jensen Huang said in a CNBC interview last week that demand for Nvidia’s latest Blackwell chips is “insane.”
Nvidia will announce earnings on November 19. Wall Street analysts expect the company to report revenue of $33 billion, up 82% from the previous year, according to Bloomberg consensus estimates. About 90% of Wall Street analysts tracking stocks tracked by Bloomberg recommend buying Nvidia stock.
Laura Bratton is a reporter for Yahoo Finance.
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