On Tuesday night,$NVIDIA (NVDA.US)$It rose to the throne of the world's highest market value company.

During the regular trading hours of June 17th, Tuesday, Eastern Time, Nvidia's stock price rose more than 4%, with a market cap of over $3.3 trillion, surpassing Microsoft, which had long dominated the market value chart. Nvidia eventually closed up 3.51%. Earlier this month, Nvidia first broke the $3 trillion market value and successfully surpassed Apple. This leap in market value once again proves the market potential of artificial intelligence technology and the great interest of investors.

Since the end of 2022, Nvidia's stock price has increased by more than nine times, and as of Tuesday's close on June 18th, it has soared 173.8%. This growth is due to its dominant position in the AI chip market, particularly in the AI chip market used in datacenters, where Nvidia holds about 80% market share. With the large demand for processors from OpenAI, Microsoft, Alphabet, Amazon, Meta and other companies, Nvidia's business is growing rapidly.

In the last quarter, Nvidia's data center business revenue increased an astonishing 427% year-on-year to $22.6 billion, accounting for about 86% of the company's total sales. This growth is due to the strong demand for its H100 accelerator, which helps data centers run complex computing tasks required for AI applications.

Founded in 1991, Nvidia was originally a hardware company that mainly sold 3D game chips to gamers. Over time, Nvidia began to get involved in cryptocurrency mining chips and cloud gaming subscription services. However, in the past two years, with Wall Street's recognition of Nvidia's potential in AI technology, the company's stock price has experienced explosive growth. This surge has made the company's co-founder and CEO Huang Renxun's net worth reach about $117 billion. According to Forbes' data, he has become the 11th richest person in the world.

At the same time, Microsoft, another major beneficiary of the AI boom, has also risen by about 20% year-to-date. Microsoft holds a large stake in OpenAI and integrates AI models into its key products, including Office and Windows. As one of the largest buyers of Nvidia's graphics processing units (GPUs), Microsoft's Azure cloud service has a huge demand for Nvidia's GPUs. Microsoft recently released a new generation of notebooks designed to run its AI models, called Copilot+.

Despite Nvidia's rapid market value growth, the company has not yet been included in the Dow Jones Industrial Average, a benchmark index composed of 30 stocks that historically included the most valuable companies in the United States. Last month, following the release of earnings, Nvidia announced a 10-for-1 stock split plan. This stock split plan will increase the likelihood that Nvidia will be included in the Dow Jones index, as the index is a price-weighted index, and companies with higher stock prices have a greater impact on the benchmark index.

Most optimistic analysts: Nvidia's market cap will approach $5 trillion in the next year.

After Nvidia completed a 1-for-10 stock split on June 10th, Rosenblatt Securities analyst Hans Mosesmann said on Tuesday that Nvidia will continue to rise and its market value could reach nearly $5 trillion in the next year. Mosesmann has also raised Nvidia's target price from $140 to $200, nearly a 47.5% increase from Tuesday's closing price, and this price has become the highest price on Wall Street. Since 2017, when Mosesmann began tracking Nvidia's stock, he has consistently given the company a buy rating and has continued to be bullish on the company's hardware products. He particularly emphasized that the combination of Nvidia's software and hardware is the company's true highlight.

Mosesmann predicts in his report to clients that Nvidia's software business will grow significantly in its overall sales mix over the next ten years, and due to its sustainability, the company's valuation will rise.

Nvidia's stock has become a favorite of sell-side analysts, with 64 analysts tracked by the media giving it a buy rating, 7 giving it a hold rating, and only 1 giving it a sell rating.

In the report, Daniel Ives, an analyst at Wedbush Securities, pointed out that he believes Nvidia, Apple, and Microsoft will be the focus of the $4 trillion market value competition in the technology industry in the next year. As the fourth industrial revolution advances, the demand for these chips from enterprises and consumers is increasing, and Nvidia's GPU chips are essentially the new gold or oil in the technology field.

Michael Lippert, Vice President and Portfolio Manager of Baron Capital Inc., emphasized in an interview that Nvidia is not just a chip sales company, they also provide systems, and the company's proprietary software and development ecosystem are key to its success.

Editor/Somer