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Nvidia and Apple Jockey for the Throne as AI Demand Fuels Market Drama

Word on the StreetSunday, Oct 27, 2024 9:00 pm ET

1min read

Nvidia recently surged past Apple to briefly become the world's most valuable company, with its stock peaking at a valuation of $3.53 trillion, slightly above Apple's $3.52 trillion. However, as markets closed, Apple's market capitalization overtook Nvidia's once more.

This isn't the first instance of Nvidia eclipsing Apple. In June, Nvidia also topped the charts, only to be surpassed again by Apple and Microsoft. These titans have oscillated closely in market value over recent months. Nvidia's resurgence is largely attributed to strong demand for its AI chips, essential for systems like ChatGPT.

Despite the accomplishment, Nvidia's hold on the top spot might be fleeting. Analysts warn that sustaining such a position requires relentless performance and growth. Nvidia's previous quarter saw a remarkable revenue increase of 122%, and earnings per share climbed by 168%. Nevertheless, maintaining this pace is crucial for Nvidia to keep or surpass current valuations.

Meanwhile, Apple remains focused on leveraging AI, planning to integrate ChatGPT into Siri. This shift underscores tech giants' race to embed AI into their ecosystems, benefiting Nvidia by expanding the market for its products. Nvidia's market trajectory will face another test with the upcoming third-quarter earnings report in November.

Though Apple's upcoming earnings are expected to show a 5.55% revenue increase to $94.5 billion, Nvidia is forecasted for a striking 82% revenue growth to $32.9 billion. Yet, the challenge remains whether Nvidia can maintain its lead against Apple's formidable presence, given the latter's diverse and expansive ecosystem.

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