NVIDIA's latest market value has risen to approximately $5.55 to $5.56 trillion. According to the data in the text, the company has added about $1.25 to $1.3 trillion to its market value over the past 12 months, and this increase alone has already surpassed its overall market value of about $1.03 trillion in September 2023.
Enters an acceleration phase after 2022
Looking at a longer period, NVIDIA has not always been at its current scale. The article mentions that the company was still a relatively small chip manufacturer in the 2000s and early 2010s. Between 2009 and 2014, its market value in September often hovered between $6 billion and $10 billion, and in 2015 it was only around $12 billion.
Thereafter, the growth began to accelerate. NVIDIA's market value was approximately $33 billion in 2016, rose to around $105 billion in 2017, and reached about $310 billion by September 2020. The real revaluation occurred after the sell-off of tech stocks in 2022. According to the text, NVIDIA's market value was around $340 billion in September 2022, and four years later it had risen to about $5.6 trillion, an increase of approximately 16 times.
AI Business drives revaluation of valuation
The article argues that this change is not merely due to an increase in valuation multiples, but is also closely related to the rapid expansion of the company's fundamentals. NVIDIA's AI related revenue has exceeded $96 billion, and the market no longer perceives it as a traditional semiconductor company.
It is mentioned in the text that NVIDIA agreed this week to acquire Hugging Face for approximately $12.93 billion. If the transaction is completed, NVIDIA will gain a greater presence in the areas of open-sourcing AI models, developer tools, and model distribution. This also indicates that its strategy is expanding from selling GPU to encompassing the software ecosystem, the developer community, and the more upstream AI infrastructure.
Impact on U.S. stock market indices is positive.
As its size expands, NVIDIA's impact on the overall fluctuations of the U.S. stock market is also increasing. The article states that the company's valuation of approximately $5.2 trillion earlier this week already accounts for about 8% of the total market value of the S&P 500 index. This means that even relatively limited fluctuations in the NVDA stock price could have a more significant impact on the performance of the index.
Looking at the timeline, NVIDIA's market value remained below $20 billion for over a decade until it surpassed $1 trillion in 2023. Today, its market value has more than quintupled this level. Based on this, the article argues that the market's focus is no longer just on when NVIDIA will become a trillion-dollar company, but rather on how its business scope is expanding beyond being just a chip manufacturer to become a platform-based enterprise.
