Buoyed by AI, NVIDIA to overtake Amazon in market value
What's the story
NVIDIA, the world's leading AI chipmaker, is closing in on Amazon's market value, thanks to Wall Street's growing interest in artificial intelligence. This year, NVIDIA's stock has soared by 40%, bringing its market capitalization to $1.715 trillion. This figure is just 3% shy of Amazon's $1.767 trillion m-cap and roughly 6% below Google parent Alphabet's $1.812 trillion valuation.
Positive analyst feedback
Morgan Stanley's optimistic report boosts NVIDIA's stocks
NVIDIA's shares rose 1.8% to $694.48 after Morgan Stanley shared a positive report, increasing its price target from $603 to $750. Analyst Joseph Moore noted that AI demand continues to surge across sectors. The chipmaker's stock has more than tripled since 2023, making it the fifth most valuable company in the US, after Microsoft, Apple, Google and Amazon. The last time NVIDIA was more valuable than Amazon was nearly 22 years ago when both firms were valued below $6 billion.
High demand for products
Long waiting time for NVIDIA's AI processors
NVIDIA's AI chips are in high demand thanks to Meta and other Big Tech companies investing billions in AI. AI developers are also experiencing long durations to access NVIDIA's processors via cloud-computing providers, although these wait times are decreasing. NVIDIA is facing competition from AMD. In December 2023, AMD unveiled the MI300 lineup of chips, claiming it will run AI software faster than what's available in the market. Tesla has also shown interest in AMD's AI chips.