Nvidia surpasses Google and becomes the 4th most valuable company – 02/14/2024 – Market

A day after surpassing Amazon’s market value, chip giant Nvidia has now also surpassed Alphabet, Google’s holding company.

Nvidia shares rose 2.5% this Wednesday (14), closing with a market capitalization of around US$1.83 trillion, surpassing the search giant’s value of approximately US$1.82 trillion, according to data compiled by Bloomberg.

With the gain, the chipmaker became the fourth most valuable company in the world and the third in the US. Saudi Aramco, from Saudi Arabia and valued at around US$2 trillion, is next on the list.

The last time Nvidia was more valuable than Amazon was in 2002, when each was worth less than US$6 billion (R$30 billion).

Nvidia shares have risen about 49% this year alone and added about $602 billion in value, driven by strong demand for its products.

The chips manufactured by the company make up data centers that perform complex computing tasks required by artificial intelligence (AI) applications.

Even though other technology companies are also performing well in 2024, they appear to be downshifting compared to Nvidia. The chip manufacturer will release its annual results next Wednesday (21).

“We are expecting another strong report, but expectations are high,” wrote Susquehanna Investment Group analyst Christopher Rolland in a note released this Wednesday (14).

Wall Street analysts are seeing signs of continued robust demand for Nvidia’s H100 AI chips. The company’s sales have been driven by AI spending from its biggest customers, which include Microsoft and Meta.

The H100 processor has 80 billion transistors — about five times more than the latest generation iPhones.

Each unit costs US$30,000 on average. Companies interested in competing in the artificial intelligence market face this price to set up the necessary infrastructure for the business.

In addition to chip design, Nvidia develops computing platforms that optimize the output of graphics processing units (GPUs). The technology giant’s team of engineers and researchers is global and includes Brazilians.

At least five brokerages raised price targets for Nvidia this month. Analysts, on average, have raised 2024 revenue estimates by more than 100% over the past 12 months, according to Bloomberg data.

Although the AI ​​craze has boosted shares of technology-related companies, Nvidia is one of the few that has demonstrated significant revenue growth from AI.

After Nvidia, Meta was the big tech that grew the most in the last 12 months, with a valuation of 165%. In January, Microsoft, also boosted last year by AI-related products, closed with a higher market value than Apple for the first time since 2021.

This Wednesday, the S&P 500 rose 0.91% and the Dow Jones, 0.33%. The Nasdaq had gains of 1.30%, driven by big techs.

Wall Street indices had fallen to their lowest levels in more than a week on Tuesday (13), after the announcement of higher-than-expected inflation in the United States. The Dow Jones recorded its worst day in 11 months.

Nvidia CEO Jensen Huang was in China in January for the first time since the start of the pandemic to reaffirm his ties with the country. He visited Beijing, Shanghai and Shenzhen, cities where Nvidia has subsidiaries.

Nvidia is the main target today in the American effort to restrict Chinese access to advanced chips. The company, based in California, has been seeking to circumvent export limitations to China determined by the US Department of Commerce since 2022.

The country accounts for a fifth of Nvidia’s revenue, according to Huang himself, who founded the company in 1993 and has around 3.5% of the company’s shares.

“If we are deprived of the Chinese market, we have no contingency for that, there is no other China,” he said last year. “If they can’t buy it, they’ll make it themselves.”

With Bloomberg