Nvidia: AI Breakthroughs Have Accelerated Dramatic Growth

With Nvidia briefly surpassing Amazon in market capitalisation, we explore how the company’s AI breakthroughs have led to business success

Renowned for its pivotal role in graphics processing unit (GPU) development for both gaming and enterprise applications, Nvidia has seen a dramatic rise.

The company experienced huge AI and generative AI breakthroughs in 2023, with CEO and Founder Jensen Huang announcing it expected to become the world’s first trillion-dollar semiconductor stock. 

Founded in 1993, Nvidia’s invention of the GPU in 1999 sparked the growth of the PC gaming market, redefining computer graphics and igniting the era of modern AI.

Today the company’s work in AI and digital twins is transforming the world’s largest industries. Services from Alibaba, Amazon, Google, Meta, Microsoft, Snap, Spotify, Tencent and 40,000 other companies are built and run on Nvidia AI technologies, while Nvidia technologies are behind recent breakthroughs in large language models used to build generative AI, the most important AI models today.

This dramatic acceleration prompted Nvidia to briefly surpass Amazon in market capitalisation in February 2024, becoming the fourth most valuable US company.

According to Reuters, at a record high of $734.96, Nvidia was worth $1.82 trillion in market value, compared to $1.81 trillion for Amazon. The last time Nvidia was more valuable than Amazon was in 2002, when each company was worth under $6 billion.

Nvidia leading in AI chip development

Nvidia has worked to enhance industry developments with AI, which includes business partnerships to unlock greater enterprise potential. The company has also recently introduced a new range of AI chips for the Chinese market, following US export restrictions on certain AI and gaming chips.

The company announced H200, the company’s newest high-end chip for training AI models: an upgrade from the H100 - the chip that OpenAI used to train GPT-4.​​​​​​​

Nvidia has been the best-performing tech stock over the last year. In its Q3 2023 report for the 2024 financial year Nvidia announced that its total revenue was up 206% year-on-year to US$18.12bn, particularly driven by strong data centre growth.

“Our strong growth reflects the broad industry platform transition from general-purpose to accelerated computing and generative AI,” said Huang, announcing the company’s most recent financial results.

“Large language model startups, consumer internet companies and global cloud service providers were the first movers, and the next waves are starting to build. Nations and regional CSPs are investing in AI clouds to serve local demand, enterprise software companies are adding AI copilots and assistants to their platforms, and enterprises are creating custom AI to automate the world’s largest industries.

“Nvidia GPUs, CPUs, networking, AI foundry services and Nvidia AI Enterprise software are all growth engines in full throttle. The era of generative AI is taking off,” he said.

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