Deena Zaidi

Data and Financial Journalist

The green line chart shows stock performance for Nvidia from January 3. 2023 to Aug. 28, 2024. A $100 investment in the company in 1999 would be worth more than $30,000 by mid-June 2024. As of June 18, Nvidia briefly became the world's most valuable company. The stock price peaked at roughly $136 per share on June 18, 2024 but dropped to $123.5 just ten days later.

Nvidia’s performance in 3 charts

Posted on Author Deena ZaidiPosted in AI, Markets, Technology

(This post will be updated after Nvidia’s earnings release on Aug. 28, 2024)

From graphics chip maker to AI leader,  Nvidia is one of the world’s most valuable publicly traded companies after briefly surpassing Microsoft and Apple.

GPUs and AI hype: Nvidia’s creation of the Graphics processing units  (GPUs) in 1999 revolutionized computer graphics and gaming, establishing the company as a leader in visual computing technology.

  • Later in 2006, the introduction of Compute Unified Device Architecture (CUDA) allowed developers to use GPUs for general-purpose computing, opening up new applications beyond graphics and gaming. 
  • This move might have positioned Nvidia at the forefront of parallel computing, laying the groundwork for its future AI and machine learning success.
  • The generative AI hype (especially with ChatGPT) further fueled the demand for its GPUs as preferred chips, making Nvidia’s existing technology more essential for training and running complex neural networks.

Financial performance: Revenue from Nvidia’s data center spiked as demand for its processing chips increased. 

  • Data Center dominance: Data Center segment has been the primary driver of Nvidia’s growth, with Q1 fiscal 2025 (ending April 28, 2024) revenue reaching a record $22.6 billion, up 427% from $4.3 billion a year ago.
  • As of April 28, 2024, Nvidia had $31.44 billion in cash, cash equivalents, and short-term investments, showcasing a solid financial position.

Competitors: Nvidia, a leader in the AI chip market, surpassed competitors such as Intel and Advanced Micro Devices (AMD).

  • Intel’s data center revenues missed out on the advanced nanometer (nm), 10nm and 7nm processes in chip manufacturing, which made processors faster and more power efficient with better performance.
  • Additionally, it lost Apple’s computer business ending a 15-year partnership. Apple shifted to its Arm-based chips in 2020.
  • In 2022, AMD surpassed Intel, after the latter’s long standing in the market for computer processors.
  • AMD has been improving its software stack but is still behind Nvidia.

What lies ahead: Tougher competition for Nvidia as Amazon, Google, Meta, AMD and Intel play catch-up in AI chip market.

Please note: I do not hold any shares in Nvidia or other mentioned companies in this story.