Nvidia, the startup at the centre of the artificial intelligence boom, has become the world’s most valuable company, knocking Microsoft off the top spot.

Nvidia’s market capitalisation hit $3.335 trillion on Tuesday as shares of the chipmaker rose by 3.5 percent to $135.58.

The feat comes just days after the Santa Clara California-based company eclipsed Apple to become the world’s second most valuable company.

Shares of Microsoft and Apple, holders of the no 2 and no 3 spots, fell by 0.45 percent and 1.1 percent, respectively.

Nvidia’s rally, which has lifted the S&P 500 and Nasdaq indexes to record highs, continues a speculator winning streak for the company, whose graphics processing units (GPUs) are integral to the development of AI.

Buoyed by voracious demand for its chips from tech giants such as Microsoft, Meta and Google, the company’s stock price has surged nearly 182 percent this year alone, after more than tripling in 2023.

Nvidia controls about 80 percent of the market for AI chips used in data centres needed to run AI models such as OpenAI’s ChatGPT.

Since its stock market debut in 1999, Nvidia shares have skyrocketed 591,078 percent.

An investor who put $10,000 into the company in 1999 would hold $59,107,800 worth of stock today, according to the Kobeissi Letter newsletter on capital markets.

Nvidia spent its first few decades focusing mainly on producing chips for computer games.

But during the 2000s, chief executive Jensen Huang directed the company to invest heavily in developing GPUs for use in applications besides gaming, setting it up to capitalise on the emergence of AI.

The company’s stunning rise has turned Huang into one of the world’s richest men, with an estimated net worth of more than $117bn, according to Forbes. (Al Jazeera)

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