Nvidia Corp (NASDAQ:NVDA, ETR:NVD) has achieved a historic milestone, becoming the first company to hit a $4 trillion market capitalization.
Shares of Nvidia added 2% on Wednesday, sending its market cap briefly above the $4 trillion level and past previous records, including Apple’s $3.15 trillion peak in December 2024.
The company’s valuation has surged amid investor enthusiasm for artificial intelligence, increasing eightfold from a $500 billion market cap in 2021. It hit $1 trillion in 2023, followed by $2 trillion in February 2024 and $3 trillion in June 2024.
AI enthusiasm boosts Nvidia
Nvidia started out mainly making graphics chips for gaming but has become a leading company in AI technology. Its chips are now used to train AI and run data centers for big tech companies like Microsoft, Amazon, Meta, and Alphabet, which together make up over 40% of Nvidia’s sales.
“Nvidia passing $4 trillion is not just a market moment, it’s a turning point,” deVere Group CEO Nigel Green said. “It tells us that AI is the defining economic engine of our time, and it needs to be present in every serious investor’s portfolio.”
However, Green cautioned against concentrating on only the headline names in the AI space.
“AI needs to be a part of every portfolio, but that doesn’t mean just buying the most obvious names. Investors should be thinking about who supports, scales, distributes, and applies the technology. This is where much of the next wave of value creation will likely occur,” he said.
“Yes, Nvidia is the clearest winner right now. But the biggest mistake investors could make is to treat it as the whole story.”
Green pointed to sectors such as AI infrastructure, enterprise software, robotics, automation, cybersecurity, and next-generation data and memory firms as areas of increasing investor attention.
“AI is no longer confined to the chip level. We’re seeing rapid adoption across healthcare, manufacturing, logistics, finance, and education,” he said. “Companies enabling this transition—from data-center cooling to AI-powered analytics—are becoming growth engines in their own right.”
Microsoft nears $4T
Analysts at Wedbush expect Microsoft Corp (NASDAQ:MSFT) to also hit a $4 trillion market cap this summer, with investor focus to then turn to the $5 trillion club as the company, alongside Nvidia, powers the AI revolution.
Microsoft shares traded up 1% at about $501 on Wednesday, giving it a market cap of $3.73 trillion.
“The poster childs for the AI Revolution are led by Nvidia and Microsoft as both are foundational pieces of building on the biggest tech trend we have seen in our 25 years covering tech stocks on the Street,” they wrote.
The analysts estimate that for every $1 spent on Nvidia, there is an $8 to $10 multiplier across the rest of the tech ecosystem.
“While AI starts with the Godfather of AI Jensen and Nvidia as the only game in town from an AI chip perspective, with AMD joining the party soon, the stalwart cloud/ hyperscale players have been another instrumental part of this first key phase of the AI Revolution being led by Microsoft and now also seeing Google and Amazon finding major cloud and AI momentum,” they wrote.
“On this consumer tech theme, we continue to like Amazon, Alphabet, and Meta as our favorite tech plays.”
Shares of Nvidia pulled back slightly by late morning on Wednesday, up 1.8% at about $163 per share, giving it a $3.98 trillion market cap.