Nvidia's success has not been without challenges, including three annual stock collapses of 50% or more. The company's future at the top of the S&P 500 will depend on continued spending on AI equipment. Nvidia's rise to the top was facilitated by its focus on graphics chips and the vision of co-founder and CEO Jensen Huang for "accelerated computing." The company's chips have become foundational in emerging technologies, including advanced graphics interfaces, autonomous vehicles, and AI products.
Key takeaways:
- Nvidia Corp. has become the best performing stock of the last quarter-century, posting a total return of 591,078% since its initial public offering, including reinvested dividends.
- On Tuesday, Nvidia unseated Microsoft Corp. as the world’s most valuable company with a market capitalization of $3.34 trillion, with more than $2 trillion of that value added this year.
- Nvidia's rise was largely due to its big bet on graphics chips and the vision of co-founder and CEO Jensen Huang that the industry would shift to what he calls “accelerated computing,” something his chips are inherently better at than the competition.
- Nvidia's data-center sales eclipsed its gaming revenue for the first time in fiscal 2023 and analysts expect those sales to top $100 billion in the current fiscal year.