US-based chip manufacturer Nvidia experiences an unprecedented surge in stock value by over 11% following strong demand for its AI chips, propelling its market capitalization to £2 trillion and surpassing UK’s AstraZeneca. The company’s impressive growth is fuelled by a 262% revenue increase year-over-year, alongside a ten-for-one stock split and a 150% rise in quarterly cash dividend, solidifying its position as a dominant player in the AI-focused tech industry.
Nvidia, a US-based chip manufacturer, experienced a significant rise in its stock value due to strong demand for its chips used in artificial intelligence (AI) applications. The company’s share price surged over 11 percent to an all-time high, contributing an additional £210 billion to its market value, culminating in a total market capitalization of £2 trillion. This growth dwarfs the £192 billion valuation of AstraZeneca, the UK’s largest firm.
The surge in Nvidia’s stock followed the release of its quarterly financial results, which showed a revenue increase of 262 percent year-over-year, amounting to £20 billion for the three months ending in April. In conjunction with these results, Nvidia announced a ten-for-one stock split, effective from June 7, and a 150 percent increase in its quarterly cash dividend.
Nvidia’s CEO, Jensen Huang, cited strong demand for AI products and expressed confidence that this momentum would continue. Nvidia’s AI-focused strategy has positioned it as a leading player among major tech companies such as Amazon, Google, Meta, and Microsoft, who are all increasing investments in AI-related infrastructure.
Founded in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem, Nvidia initially focused on PC gaming and graphics processing units (GPUs). The company has since evolved, with its AI chip business driving a notable increase in its market value, surpassing $1 trillion in May last year and solidifying its place among the ‘Magnificent Seven’ tech giants.
Nvidia’s year-to-date growth of 92 percent has seen its valuation rise by $1.152 trillion as of May 22. The company’s latest fiscal quarter saw a revenue haul of $26 billion, tripling the $7.2 billion recorded the previous year. The upcoming stock split aims to make Nvidia shares more accessible to a broader range of investors.
