company shares Nvidia Corp jump strong this Thursday and the company reaches a market value close to $1 trillion, after its strong forecast showed that Wall Street has not yet priced in the game-changing potential of spending on artificial intelligence (AI), which is seen as the technology of the future.
The climb added to more than doubling of shares this year and would increase the chip designer’s value by about $190 billion, to nearly $945 billion. It is, thus, one step away from the largest revaluation of an American company in a single day, a record currently held by Apple Inc, with its jump of US$190.90, which it gave on November 10.
“In the more than 15 years that we have been doing this work, we had never seen a guide like the one just presented by Nvidi“With a second quarter outlook that has clearly been cosmological, and that has dashed expectations,” said Bernstein’s Stacy Rasgon.
Nvidia’s results trigger its financial dynamics
nvidia, fifth most valuable US companyscreened on Wednesday some quarterly income more than 50% above Wall Street’s median estimate and said it would have more supply of AI chips in the second half to meet increased demand.
Consequently, the average price target has more than doubled this year. With the highest view, a $600 price target from Rosenblatt Securities and HSBC, Nvidia would be worth $1.48 trillion, more than Amazon.com Inc, the fourth most valuable US company.
That is why The company’s shares jump 26.64% this Thursday, up to US$386.68 per paper, a very high rise.
A boost for the technology sector
Strong results from Nvidia also sparked a rally in the chip sector and AI-focused companies, lifting stock markets from Japan to Europe. Thus, in the United States, companies such as Alphabet Inc, Microsoft Corp and AMD shot up between 3% and 10%.
Analysts were quick to raise their price targets for Nvidia shares, with 27 raising their views on the idea that all Artificial Intelligence (AI) paths lead to the company.as it provides the chips used to power ChatGPT and many similar services.
Its chief executive, Jensen Huang, stated that lhe current data center equipment, valued at $1 trillion, they will have to be replaced by AI chips, as generative AI applies to all products and services.
The results bode well for big tech companies, which have been targeting AI in the hopes the technology will help them attract demand at a time when their profit engines, digital advertising and cloud computing, They are under pressure from a weak economy.
“This forecast of Nvidia changes the entire narrative around AI and the demand for the future in the company. There may be a historic turning point in the AI revolution, with Nvidia as the key barometer,” said Wedbush’s Dan Ives.
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