Witness the milestone moment of artificial intelligence! NVIDIA's market value surpasses Apple, reclaiming the title of "King of the Stock Market."

According to the Zhitong Finance APP, as of Tuesday's close of the U.S. stock market, NVIDIA (NVDA.US), the AI chip giant referred to by Goldman Sachs as "the most important stock on Earth," has seen its total market capitalization surpass that of consumer electronics giant Apple (AAPL.US), earning the title of "the highest market capitalization company in the world." This highlights the absolute dominance of the "artificial intelligence" investment theme on Wall Street and in global stock markets.

Recently, NVIDIA pushed out Intel (INTC.US) and successfully entered the Dow Jones Index. Shortly thereafter, its total market capitalization surpassed Apple, reclaiming the title of "king of the stock market" after a five-month hiatus, witnessing how artificial intelligence is reshaping the stock market. However, the "NVIDIA myth" seems far from over! Many Wall Street analysts believe that the crazy surge in NVIDIA's stock price is far from stopping.

NVIDIA's stock price rose 2.84% on Tuesday, reaching $139.910, with a staggering market capitalization of $3.43 trillion, leading Apple's $3.38 trillion total market capitalization. Another tech giant, Microsoft (MSFT.US), which was surpassed by NVIDIA last month, has a market capitalization of about $3.06 trillion. Microsoft has long held the title of "the highest market capitalization company in the world" by fully embedding OpenAI's large models into its flagship software products like Office.

NVIDIA, the "Protagonist of a Feel-Good Novel"

NVIDIA's "path to glory" resembles the core male protagonist of a feel-good novel. Since the end of 2022, NVIDIA's stock price has surged an astonishing 850%, and from the low point in October 2022, the increase has reached an incredible 1000%.

"In the past few quarters, people seem to have mainly focused on inflation data, employment data, and 'NVIDIA data,'" said Fahl Anina, research director at James Investment Research. "NVIDIA's market capitalization exceeding Apple's not only indicates that it is one of the biggest beneficiaries of the artificial intelligence infrastructure cycle but also suggests that people expect the AI boom to continue sweeping the globe."

Statistics show that chip giant NVIDIA currently accounts for about 7% of the total weight of the U.S. stock market index—the S&P 500 index, contributing approximately 25% to the 21% increase of this benchmark index this year. In June, NVIDIA first closed with the title of "the highest market capitalization company in the world," slightly surpassing tech giant Microsoft, becoming the largest publicly traded company globally. However, this prestigious title was held for only one day and was subsequently occupied by Apple for a long time. This time, NVIDIA surpassed Microsoft first, and soon after, surpassed Apple, once again earning the title of "the market leader."

In the U.S. stock market, the "Magnificent Seven" tech giants, including NVIDIA, are increasingly characterized by their "artificial intelligence content." The seven major tech giants that dominate the S&P 500 and Nasdaq indices, known as the "Magnificent Seven," include: NVIDIA, Apple, Microsoft, Google, Amazon, Meta Platforms, and Tesla.

Recently, Apple launched the AI smartphone iPhone 16 series, which may lead a new round of upgrades in Apple's smartphone cycle; the cloud computing businesses of the three tech giants—Microsoft, Amazon, and Google's parent company Alphabet—are increasingly linked to artificial intelligence; Meta Platforms, the parent company of Facebook, is leading the global AI wave with its AI-based digital advertising service tools and Meta AI, which is gaining popularity and reaching 3 billion users, rivaling ChatGPT; Tesla is stirring up the autonomous driving trend globally with its Full Self-Driving (FSD) system built on AI supercomputing.

Moreover, apart from Apple, these companies are the largest customers of NVIDIA, and they emphasized their commitment to significant spending on artificial intelligence during their recent earnings calls, with executives from these tech giants making comments about "continuing to burn cash." Wall Street investment firms generally believe that NVIDIA will continue to thrive and remain one of the biggest beneficiaries of the global AI boom in the near future. Among the seven tech giants, except for the AI chip leader NVIDIA, the other "six giants" have already released their financial reports. NVIDIA is set to announce its earnings after the market closes on November 20, Eastern Time.

NVIDIA is not only the largest company by market capitalization in the field of artificial intelligence but also one of the best-performing stocks in the U.S. stock market this year. NVIDIA's stock price has risen 183% this year, making it the third-best performing stock in the S&P 500, following Vistra Corp (VST.US) and data analytics software company Palantir Technologies (PLTR.US). Both of these leading companies in the S&P 500 also benefit from the global AI frenzy, with Vistra significantly benefiting from the enormous power demand driven by the surge in data center construction, which is the core infrastructure project of AI, while Palantir is regarded as the absolute leader in AI software applications.

Recently, NVIDIA has effectively alleviated investors' concerns about the production challenges of its Blackwell architecture AI GPUs due to chip manufacturing engineering obstacles, as well as the tech giants' determination to continue high spending on artificial intelligence. Consequently, worries about NVIDIA's long-term growth prospects have significantly dissipated, leading to a strong stock rally and helping it achieve the title of "the world's highest market capitalization company." Throne.

According to analyst expectation data compiled by institutions, analysts generally expect NVIDIA's revenue for this fiscal year to more than double, with an additional 44% increase in the next fiscal year. Wall Street analysts have continuously raised their expectations for NVIDIA's revenue and earnings per share over the past quarter.

In addition to the "Blackwell optimism" driving bullish sentiment, NVIDIA's exclusive AI chip foundry partner, TSMC (TSM.US), recently reported earnings that showed a "surge in global AI chip demand," which also indirectly boosted NVIDIA's stock price. TSMC executives stated that the advanced packaging capacity of CoWoS will be difficult to meet market demand until 2026. The CoWoS S/L/R advanced packaging capacity is crucial for the production of NVIDIA's Blackwell AI GPU and other broader AI chips.

The latest round of financing for OpenAI, the developer of ChatGPT and a leader in the generative AI field, has raised its valuation to $157 billion, further fueling the global AI investment boom. OpenAI recently released an AI large model with incredibly powerful AI reasoning capabilities, which is also a key area of research for Google's parent company Alphabet. This technology field urgently requires substantial AI reasoning computing power, indicating that the demand for NVIDIA's AI GPUs is virtually limitless.

"The New King of the Stock Market" NVIDIA's Surge is Far from Over! Next Stop, $5 Trillion Market Cap?

"The impact of artificial intelligence is becoming increasingly significant, with large tech companies globally investing hundreds of billions of dollars, among which NVIDIA stands to benefit the most," said Anina from James Investment. "Overall, its outlook remains very optimistic."

The "burning money wave" for artificial intelligence among global enterprises, including the "Big Six," remains unstoppable, and the stock logic closely related to AI chips is extremely robust. The stock price surge of AI chip leaders like NVIDIA may be far from over. Especially in the data center AI chip sector, where NVIDIA holds an 80%-90% market share, the stock price may continue to set historical highs, and breaking the $150 mark, which Wall Street analysts generally expect, may just be a matter of time. Recently, Wall Street financial giant Bank of America reaffirmed its "buy" rating on NVIDIA and significantly raised its 12-month target price from $165 to $190, reiterating the "buy" rating.

According to the latest forecast data from Wall Street financial giant Citigroup, by 2025, the data center-related capital expenditures of the four largest tech giants in the United States are expected to grow by at least 40% year-on-year, and these massive capital expenditures are largely tied to generative artificial intelligence, indicating that the computing power demand for AI applications like ChatGPT remains substantial. Citigroup stated that this means that the spending scale of giants on data centers is expected to continue to expand significantly on top of the already strong spending scale in 2024. The institution expects this trend to provide very substantial positive catalysts for NVIDIA and data center interconnect (DCI) technology providers' stock prices.

Solita Marcelli, Chief Investment Officer of UBS Global Wealth Management for the Americas, stated that by 2025, the total sales of chip companies closely related to artificial intelligence are expected to leap from this year's $168 billion to $245 billion. AMD CEO Lisa Su recently stated at a product launch that the demand for data center AI chips, including AI GPUs, far exceeds expectations, and it is anticipated that by 2027, the market size of data center AI chips will reach $400 billion, further rising to $500 billion in 2028, indicating that the global data center AI chip market's compound annual growth rate is expected to exceed 60% from 2023 to 2028.

Another Wall Street investment firm, Rosenblatt, in a research report, dramatically raised its 12-month target price for NVIDIA from $140 to an astonishing $200 per share, ranking it as the highest target price on Wall Street for NVIDIA. According to Rosenblatt's chip industry analyst team, with the revenue growth driven by software centered around CUDA, NVIDIA's market value is justified at $5 trillion.

The Rosenblatt analysis team stated that based on the potential prosperity expectations of NVIDIA's software business centered around CUDA, even if the AI chip giant NVIDIA's stock price experiences a period of explosive growth, the stock price of this chip giant will continue to rise over the next 12 months. Therefore, in addition to the substantial GPU revenue brought by the tightly bound NVIDIA AI GPUs through CUDA, the large-scale application of enterprise-level CUDA platforms also contributes to revenue generation, with the software business derived from the CUDA platform being another engine for NVIDIA's massive revenue generation.

The CUDA ecological barrier can be regarded as NVIDIA's "strongest moat." NVIDIA has been deeply involved in the global high-performance computing field for many years, especially with its self-developed CUDA computing platform that has become popular worldwide, making it the preferred software and hardware collaborative system in high-performance computing fields such as AI training/inference. The CUDA accelerated computing ecosystem is a parallel computing acceleration platform and programming assistance software exclusively developed by NVIDIA, allowing software developers and software engineers to use NVIDIA GPUs to accelerate parallel general computing (only supports NVIDIA GPUs and is not compatible with mainstream GPUs such as AMD and Intel).

CUDA is an extremely relied-upon platform for developing generative AI applications like ChatGPT, and its importance is on par with NVIDIA's AI GPU hardware system, being crucial for the development and deployment of large AI models like GPT. With its high technological maturity, absolute performance optimization advantages, and extensive ecosystem support, CUDA has become the most commonly used and widely adopted collaborative platform in AI research and commercial deployment