Nvidia has become the first public company in history to reach a $4 trillion market valuation, cementing its dominance in the AI race and taking the top spot on Wall Street.

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Shares in the semiconductor giant rose 2.5% on Wednesday to a record $164, propelling it past tech rivals Apple and Microsoft and setting a new benchmark for investor confidence in artificial intelligence. Nvidia now carries the highest weight on the S&P 500 index at 7.3%, ahead of Apple (7%) and Microsoft (6%).

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From Graphics to Global Powerhouse

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The company’s rise has been nothing short of meteoric. Once known for powering gaming PCs, then riding the crypto mining wave, Nvidia is now the undisputed backbone of AI infrastructure — its high-performance chips powering everything from ChatGPT to data centres and autonomous vehicles.

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“It started out as a gaming chipmaker, then a crypto chipmaker, and now it’s a chipmaker for artificial intelligence computing power,” said Art Hogan, chief market strategist at B Riley Wealth. “It is a clear early winner of artificial intelligence.”

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Nvidia first crossed the $1 trillion threshold in June 2023. It has since tripled its value in just over a year — a pace that outstrips even Apple and Microsoft’s historic runs.

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Its $4 trillion valuation is now larger than the entire value of all listed companies in the UK and surpasses the combined market capitalisations of Canada and Mexico.

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AI Optimism Overcomes Global Jitters

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The latest surge in Nvidia stock comes despite a rocky start to 2025. In April, markets were rattled by the emergence of a Chinese-made discount AI model from DeepSeek and renewed global trade tensions sparked by former U.S. President Donald Trump’s tariff threats.

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But Nvidia rebounded strongly — up 74% from its April lows — as optimism returned around U.S. trade deals and the AI boom continued unabated. So far this year, the stock is up more than 22%, outpacing the Philadelphia Semiconductor Index, which has gained just under 15%.

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Market sentiment has also been buoyed by strong financials. Nvidia reported first-quarter revenue of $44.1 billion — up 69% year-on-year — with earnings of 81 cents per share. It expects second-quarter revenue to come in around $45 billion, and investors will be watching closely when it reports on 27 August.

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Still Room to Grow?

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Despite its astronomical rise, analysts suggest Nvidia may still be undervalued relative to its future earnings potential. The company is trading at a forward price-to-earnings ratio of 32 — lower than its three-year average of 37, according to LSEG data.

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Meanwhile, its AI-fuelled growth is increasingly being seen as strategic infrastructure. The company’s influence spans not only big tech, but defence, finance, and even geopolitics — making it a key player in the shifting global tech landscape.

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