Nvidia Corporation (NASDAQ:NVDA) is an American company engaged in the production and sales of graphics cards and GPUs. Founded in 1993, it has emerged as a prominent player in the computer technology industry.
In the final week of May, the company's market value reached a trillion dollars during an auction, setting a record as no other chip manufacturing company has ever achieved such a capitalization. Several factors contributed to this, such as the release of the new GeForce RTX 4090 graphics card, an excellent earning report, and the hype around AI. As a result, attention to the shares has increased several times, naturally leading to a surge in their price. As always, the news background has done its job – the economic calendar never lies.
Nvidia manufactures a wide range of products, including video cards, processors, graphics servers and other devices. Nvidia is recognized for its innovative technologies and support for multiple platforms such as Windows, Linux, and macOS.
A distinctive feature of Nvidia is the use of the CUDA architecture, enabling programmers to create high-performance data processing applications on a GPU. This facilitates faster calculations and enhanced application performance.
One of the recent developments from Nvidia is the release of its new GeForce RTX 4090 graphics card, boasting the highest number of cores available, 16 GB of video memory, and a performance of 170 teraflops. It is also equipped with Ray Tracing technology, which allows you to create realistic light refraction and reflections for video game graphics.
In addition, Nvidia plays a significant role as a primary manufacturer for game consoles like Xbox and PlayStation. So, it doesn't matter which side you're on, Nvidia is raking in the revenue.
The company is also working on creating new technologies for virtual reality.
Notably, Nvidia became the ninth publicly traded company globally to surpass the $1 trillion valuation mark. The first company to achieve this milestone was the Chinese oil and gas company PetroChina in 2007, following its listing on the Shanghai Stock Exchange (SSE). On its first day of trading, PetroChina's capitalization reached $1.005 trillion.
Nvidia also announced plans to release new artificial intelligence products, such as NVIDIA Clara, designed to analyze medical images and diagnose diseases. The company is also involved in developing technologies for autonomous driving.
Overall, Nvidia Corporation is one of the most innovative and successful technology companies in the world. Its products are used in various industries, ranging from gaming to scientific research and medicine.
In a report for the first quarter, the company said that the spread of AI technologies is resulting in record sales. Thanks to the growing AI market, the company increased its revenue forecast for the second quarter to about $11 billion, which is more than 50% higher than Wall Street's estimate of $7 billion. Nvidia’s CEO Jensen Huang expressed the company's receipt of remarkable orders for its products.
Also, Jensen Huang shared his opinion on the development of artificial intelligence at Computex 2023, stating the spread of new, powerful AI-based tools will allow anyone to overcome the "digital barrier" and master the profession of a programmer.
Nvidia also unveiled new products and partnerships in the field of AI. Notably, the company is collaborating with advertising giant WPP to develop an advertising platform.
During trading on May 30, Nvidia managed to reach a peak of $412 per share, resulting in the company's market capitalization reaching the trillion-dollar milestone. By the end of the session, the value of the securities slightly decreased and settled at $401.11. Over the past month, NVDA shares showed explosive growth, increasing by 45%, and since the beginning of the year, the company's value has surged by almost 170%.
Among other things, the company is planning to actively work on the creation of cloud technologies that enable users to access their data and programs via the Internet. The company also aims to enhance its services for streaming high-quality games and videos, which have gained popularity among gamers and attracted the attention of traders who recognize their significant potential. The GeForce Now service continues not only to win the hearts of gamers with its convenience, but also to attract the attention of traders who are realizing the incredible potential of technology.
Accordingly, the company plans to expand its product range, including the release of new video cards, chips, and solutions for data centers. This strategic move aims to increase the company's market share by providing users with more powerful and efficient solutions.
Nvidia is also committed to collaborating with other companies to create new products and technologies. For instance, back in 2019, the company announced a partnership with Microsoft to create a new game engine for Windows 10 games. In February 2023, Nvidia revealed plans to launch its first gaming laptop based on the Arm architecture.
On May 24, 2023, Nvidia shared the results of its first quarter of fiscal year 2024, which ended on April 30. Over the past quarter, the company managed to earn $7.19 billion, showing a 19% improvement compared to the previous quarter and a 13% deterioration compared to the same period last year.
More than half of this amount, namely $4.28 billion, was earned through the implementation of high-performance computing accelerators designed for data centers. This figure includes accelerators utilized in artificial intelligence, where the demand unexpectedly surged, resulting in record-breaking revenue for this division.
Overall, Nvidia's performance in the first quarter of fiscal year 2024 was highly successful, primarily driven by the substantial adoption of AI accelerators, which have been in high demand by partners. The company forecasts a revenue increase to $11 billion by the end of the upcoming quarter.
The latest Nvidia news shows that the company continues to develop its products and offers new solutions for gamers and professionals in the field of streaming and content creation. However, whatever analysts say, conducting a thorough analysis before any trade is rule #1 that every investor should stick to.