Nvidia is about to overtake Apple and become the second most valuable company in the world as the biggest beneficiary of the surge in AI application adoption that has made the iPhone maker the biggest Wall Street company by market value for years.
The reliance of virtually all artificial-intelligence applications, such as OpenAI's ChatGPT, on Nvidia's high-performance chips has helped Nvidia's stock value nearly triple in the past year to $2.7 trillion ($2.700 billion). By comparison, Apple has a market value of 2.9 trillion.
Even Microsoft's market value is closing in on Nvidia. At the close of Wall Street on Friday, Microsoft was worth $3.09 trillion. Bizarre but true: Microsoft shares rose 12.06% this year, barely more than the S&P 500 (11.27%).
But while Apple's P/E ratio is 30 and Microsoft's is 36, Nvidia is estimated by investors to be as much as 64 times annual earnings. Nvidia posted revenue of $26 billion in the first quarter of fiscal 2025, up 18% from Q4 and up 262% from a year ago. Net profit was $14. 88 billion, up $2 billion from the previous year.
It is hard to imagine, but with even slightly sustained growth and continued P/E ratios above 60, Nvidia will have passed both Apple and Microsoft and become the world's most valuable company before the end of the year. That is the economic reflection of the global AI wave.
Recommended: webinar on AI applications
Every reason to learn more about what AI can do for your organization. For those interested in learning more about how AI and especially custom GPTs can be used to generate leads and improve services, NXTLi is hosting a webinar on Friday, June 7, at noon, for which you can register here.