Nvidia becomes first in the world to be worth $4 trillion

America’s biggest company just hit a shocking milestone. The rapidly rising computer chipmaker Nvidia became the first public company to top $4 trillion in value on Wednesday. It’s another milestone for a company that has been on a blistering, two-year investor frenzy.

Early Wednesday, Nvidia shares rose 2.5 percent, or $3.97, topping $164 apiece. At the beginning of 2023, Nvidia shares were around $14 each. It’s rise ballooned the company’s value by 239 percent. Nvidia basically fell into its blossoming business model. For years, the company made graphics processing units (GPUs) for video games.

That same technology has become critical during America’s AI boom. The chips that powered Fortnite, Assassin’s Creed, and Call of Duty also had the capacity to run large language models like ChatGPT and Claude. The sudden discovery has made Nvidia the poster child of the AI boom. It’s now the most valuable company in the world, surpassing Microsoft, Apple, Amazon, and Google parent Alphabet. It just passed Apple’s valuation in January. It blew past Microsoft earlier this month.

Nvidia’s stock movement carries more weight on the S&P 500 and other indexes than any company besides Apple. Two years ago, Nvidia’s market value was below $600 billion. In its most recent quarter, Nvidia overcame tariff-driven turbulence to deliver another round of robust growth amid feverish demand for its high-powered AI chips. Nvidia earned $18.8 billion, a 26 percent increase from the same time last year. Revenue surged 69 percent from a year ago to $44.1 billion.

The company might have done even better if it weren’t for growing political tensions across the globe. Nvidia absorbed a $4.5 billion charge to account for US government restrictions on chip sales to China. Without that charge, the company would have blown past Wall Street’s earnings expectations.

Nvidia reports its second-quarter results next month. Wall Street is expecting another quarter of record sales and profit for the Santa Clara, California, company. Nvidia and other companies benefiting from the AI boom have been a major reason the S&P 500 has climbed to record after record recently. Their explosion of profits has helped to propel the market despite worries about stubbornly high inflation and possible pain coming for the US economy from tariffs and other policies of President Donald Trump.

Microsoft has been another beneficiary. The company’s leadership on AI and longstanding partnership with ChatGPT’s owner, OpenAI, has boosted shares by 19.7 percent year-to-date. But not every company has been on a similar tear this year.

Apple has been one of America’s worst-hit tech companies this year, with its stock price sliding 11 percent on the year. The iPhone producer has been caught in the middle of the escalating trade war and has been a particular focus of President Donald Trump’s administration because of its foreign supply chain. Intel has also been badly hurt by the move to AI.

The formerly dominant chipmaker has looked flat-footed to investors due to its slow transition to AI-capable chips. The Silicon Valley chipmaker recently announced it is slashing thousands of positions at its factories to make deeper investments in the tech.