The frenzy around AIs explodes the share price of Nvidia!

While being unbeatable on gaming graphics cards, Nvidia continues to conquer the market of components for artificial intelligence and expects strong growth in its revenues

By announcing to be able to generate $11 billion over the current fiscal quarter (which will end at the end of July), the firm surprised analysts who were counting on sales of around 7.2 billion dollars.

This hypergrowth is driven above all by graphics accelerators and components dedicated to artificial intelligence, for which Jensen Huang, CEO of Nvidia, indicates the demand is extremely strong to equip data centers around the world.

Nvidia has been taking advantage of the rapid rise of generative AI since launching OpenAI’s ChatGPT in late 2022, since largely taken over by Microsoft for its Bing engine and Office applications. Google had to retaliate in disaster with an AI Bard which is beginning to be deployed.

Do not kill the goose with the golden eggs

This contrasts sharply with the results for the last fiscal quarter of 2023, which ended at the end of April, which only reached $7.19 billion, down 13% year-on-year (but still above analyst consensus) and are linked to the decline in sales of PCs (and by extension that of graphics cards) in the consumer segment.

Nvidia H100 with Hopper architecture, all for AI

Artificial intelligence would therefore be the ultimate growth driver for Nvidia and this is undoubtedly why Jensen Huang called on the political powers to think carefully about the consequences of the trade restrictions imposed on China, a huge market for AI and graphics cards. .

He recalled that there is no market equivalent to China and that blocking access to recent components would be very damaging to the American high-tech industry.

Close to $1 trillion valuation

With the current sales outlook, one can understand his concern. In the meantime, investors have been enthusiastic about Nvidia’s optimism, to the point of making its stock price jump…from 26% after the presentation of the financial results!

What strongly boost its stock market valuation which now reaches $951 billion…up from $755 billion the day before, CNBC reports, and with prospects for rapid growth.

Nvidia is no longer very far from entering the very closed club of companies capable of reaching 1000 billion dollars in value, such as Apple, Microsoft, Google or Amazon. It would then be the first company in the world in the field of semiconductors to achieve such a value.