In October 2024, Nvidia’s market value skyrocketed by 9.3%, pushing it to a record-breaking $3.26 trillion. This surge is largely attributed to the unyielding demand for its cutting-edge AI chips, which are powering the rapidly expanding Artificial intelligence sector. As businesses increasingly integrate AI into their operations, Nvidia stands out as a key player in the AI revolution, helping the company briefly surpass Apple as the world’s most valuable firm.
Nvidia’s primary supplier, Taiwan Semiconductor Manufacturing Company (TSMC), also saw a significant boost in market capitalization, rising 6.5% to $832.8 billion. TSMC, benefiting from strong sales of Nvidia’s AI chips, posted a remarkable 54% increase in quarterly earnings. The robust demand for AI chips has helped offset declines in other markets, particularly mobile devices, marking a pivotal shift in the semiconductor industry.
This surge in market value isn’t happening in a vacuum. The entire tech landscape is undergoing a transformation, with AI as the central force. Notably, Apple, which briefly lost its position as the top company by market cap, saw a 3% dip to $3.4 trillion. This decline was attributed to sluggish sales in China and a subdued growth forecast. Meanwhile, rivals like Meta Platforms and Microsoft also experienced declines, underscoring the uneven nature of the market amid rising AI development costs.
Experts, including Mark Haefele, Chief Investment Officer at UBS Global Wealth Management, are optimistic about AI’s potential. Haefele forecasts AI-focused portfolios to grow by 35% in 2024 and 25% in 2025, citing the surge in demand for AI technologies as a key growth driver. However, as competition intensifies in the AI chip market, with companies like AMD and Intel ramping up their efforts, Nvidia will need to keep innovating to stay ahead of the pack.
This rapid growth has sparked concerns about the long-term implications for both Nvidia and TSMC. With rising competition, questions loom about whether these companies can maintain their market dominance, and whether regulatory scrutiny could increase in light of their growing power in the semiconductor sector.
Market Value Changes in October 2024:
| Company | Market Value (Oct 2024) | % Change |
|---|---|---|
| Nvidia | $3.26 trillion | +9.3% |
| Apple | $3.4 trillion | -3% |
| TSMC | $832.8 billion | +6.5% |
| Meta Platforms | N/A | Decline |
| Microsoft | N/A | Decline |
| Tencent Holdings | $483 billion | -9% |
