In a remarkable feat, computer chip manufacturer Nvidia briefly joined the elite league of trillion-dollar companies as the demand for artificial intelligence (AI) technology reached an unprecedented crescendo. On May 30, during the morning trading hours in the United States, Nvidia’s shares skyrocketed to a daily high of over $418, propelling the company’s market capitalization to cross the $1 trillion threshold, as reported by Google Finance.

Although Nvidia’s shares closed the day at just over $401, the company currently boasts a market cap of $992 million. This achievement places Nvidia in an exclusive group of American companies with valuations exceeding $1 trillion, alongside tech giants Apple, Microsoft, Amazon, and Alphabet (Google’s parent company).

The impressive year-to-date gain of over 180% experienced by Nvidia can be attributed to the soaring demand for graphics processing units (GPUs), which power generative AI tools. Remarkably, a staggering 80% of these GPUs are currently manufactured by Nvidia, according to a Reuters report.

While some analysts view Nvidia’s recent breakout price action as a sign of an overheated market, others suggest that the company still has ample room for further growth. They argue that the AI boom may have only just begun, with technical traders and AI enthusiasts propelling Nvidia toward the $1 trillion market cap. Jim Kelleher, an analyst from Argus Research, noted that although Nvidia’s valuation is substantial, it is not inexpensive.

Nvidia’s pursuit of AI-ready chips is not unique, as other industry leaders are also investing in this technology. Microsoft, for instance, is reportedly developing its own AI chip to power AI applications for OpenAI, headed by Sam Altman, as well as for internal projects. Moreover, Elon Musk, former CEO of Twitter, has recently acquired thousands of general processing units for an upcoming Twitter AI project, indicating the growing interest in AI-related advancements.

While American tech companies and chip manufacturers are racing to keep pace with the AI revolution, Chinese developers are finding innovative ways to circumvent sanctions that restricted access to the latest Nvidia chips. This highlights the global significance of AI development and the fierce competition in the tech industry.

As Nvidia surges toward the trillion-dollar mark, its remarkable success underscores the tremendous potential of AI technology. With its unmatched capabilities in GPU manufacturing and the ever-expanding market demand for AI, Nvidia is well-positioned to shape the future of this transformative field.