Nvidia Surpasses Microsoft to Regain Title of World's Most Valuable Company

Nvidia has reclaimed the title of the world's most valuable company, surpassing Microsoft, after a 2.8% gain in its stock price. The semiconductor firm ended the session with a market cap of $3.446 trillion.

Nvidia has reclaimed the title of the world's most valuable company, surpassing Microsoft, after a 2.8% gain in its stock price. The semiconductor firm ended the session with a market cap of $3.446 trillion [NUMBER:1].

Nvidia's stock price surge comes after a period of uncertainty, including the launch of DeepSeek, a Chinese competitor, and rumors of U.S. chip tariffs. Despite these challenges, Nvidia reported strong fourth-quarter earnings that exceeded market expectations, showcasing continued growth driven by artificial intelligence (AI) [NUMBER:1].

The company's latest quarterly results include revenue of $39.33 billion, surpassing the estimated $38.05 billion, and adjusted earnings per share of $0.89, above the expected $0.84. Net income for the quarter rose to $22.09 billion, or $0.89 per share, compared to $12.29 billion, or $0.49 per share, in the prior year. Gross margin was 73%, down three points year-over-year due to more complex and costly data center products [NUMBER:1].

Nvidia's revenue surged 78% in the quarter, with full-year revenue up 114% to $130.5 billion. Looking ahead, Nvidia expects approximately $43 billion in first-quarter revenue, implying a year-over-year growth of 65% [NUMBER:1].

The AI chip market is expected to reach $311 billion by 2029, growing at a 20.4% CAGR. Applying that growth rate to Nvidia's estimated $90 billion annual data center sales suggests over $225 billion in AI-related revenue by 2029. If margins hold steady, this alone could justify another doubling of NVDA stock price [NUMBER:1].

While the market remains optimistic about Nvidia's future, the company's stock has been volatile due to competition and broader market conditions. DeepSeek's R1 release in January 2025 raised concerns over the future demand for Nvidia's GPUs, resulting in a nearly $600 billion drop in market cap. However, Nvidia's management has been proactive in addressing these challenges, collaborating with DeepSeek to optimize its technology for Nvidia's GPUs [NUMBER:1].

In conclusion, Nvidia's recent stock price gain highlights the company's resilience and continued leadership in the AI chip market. Despite competition and broader market uncertainties, Nvidia's strong earnings and growth prospects suggest a bright future for the company.

References:
[1] https://www.ccn.com/news/business/nvidia-stock-price-five-years-nvda-results/