(Bloomberg) -- Nvidia Corp became the first chipmaker to achieve a $1 trillion market valuation on Tuesday, as excitement over artificial intelligence technology has led to a massive advance in the stock.
Shares gained as much as 7.7%, and it last traded with a market capitalization of $1.01 trillion. The stock has soared by about 180% this year. In contrast, the Philadelphia Stock Exchange Semiconductor Index has risen by about 41% in 2023, touching its highest intraday on Monday since February 2022.
Nvidia has powered past other semiconductor companies as it is the world’s biggest maker of the specialized chips needed to power a new generation of AI products, one of the biggest investment themes on Wall Street.
Not only has it trounced the performance of other components of the index — it has done roughly twice as well as the next-best performer, Advanced Micro Devices Inc., up 93% — but it has vastly eclipsed them in size. The second-biggest component of the semiconductor index is Taiwan Semiconductor Manufacturing Co., which has a market capitalization of more than $530 billion. In third place is Broadcom Inc., valued at just over $360 billion.
Fewer than 10 stocks have ever topped the $1 trillion threshold, and with Nvidia’s milestone, it joins Alphabet Inc. and Amazon.com Inc. among US companies currently trading above this level. Both Apple Inc. and Microsoft Corp. are valued above $2 trillion.
©2023 Bloomberg L.P.