Chipmaker and software publisher Nvidia has become the third most valuable company on Wall Street and the fourth in the world, Reuters revealed yesterday evening. A place gained by overtaking Alphabet, parent company of Google, a few hours after passing Amazon.
The Santa Clara firm's stock rose 2.46% to $1.826 billion, while Alphabet's stock rose 0.55% to $1.821 billion. At the World level, Nvidia ranks fourth, behind software company Microsoft ($3.04 trillion), Apple ($2.84 trillion) and Saudi state oil company Saudi Aramco ($2.07 trillion).
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Soon the launch of a new GPU
Why such a breakthrough? Nvidia has been able to take advantage of the boom in artificial intelligence. In particular, by developing chips that power large language models (LLM), such as the H100 chip, the most powerful graphics processor marketed so far by the firm. This board is optimized to train LLMs from OpenAI, Amazon and Meta.
On January 19, Mark Zuckerberg, CEO of Meta, announced that he wanted to acquire 350,000 H100 GPU accelerators by the end of the year. Nvidia now owns 80% of the high-end chip market, which has caused its stock value to soar 47% this year.
And the multinational does not intend to stop there. In November 2023, Nvidia launched its new GPU, H200, designed for generative artificial intelligence. A model with 80% more memory compared to its predecessor, and with a bandwidth gain of around 40%. These GPUs are expected to be launched from the second quarter of 2024 in data centers, including those of Amazon Web Services (AWS), Google Cloud, Microsoft Azure and Oracle.
Nvidia wants to conquer the custom chip market
On the other hand, the California company has diversified its business by creating custom chips for cloud computing companies. A market currently representing only 5% of annual global chip sales and $30 billion, dominated by Broadcom and Marvell Technology. According to Reuters, Nvidia has already discussed with Amazon, Meta, Microsoft, Alphabet and OpenAI to attack the market and invest in a new unit. In addition to custom chips for the cloud, the company is reportedly considering offering ones for telecommunications, automobiles and video games.
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Nvidia's quarterly earnings report will be released on February 21. An announcement which could lower it in the ranking, given its valuation close to Alphabet. Quarterly profits are forecast to triple to $20.37 billion.
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