Nvidia Overtakes Microsoft Again As World’s Second-Largest Company

Nvidia has grown rapidly this year, increasing its market capitalization significantly and leaving behind Microsoft.

Nvidia has emerged as one of the largest chipmakers in the world and has the biggest supply of raw semiconductor materials. In tandem with the unbelievably fast growth of demand for semiconductor chips to meet the expanding Artificial Intelligence capabilities, Nvidia’s market capitalization has overtaken Microsoft as the second-largest company in the world.

Nvidia’s shares had to climb just over 2% on Monday, raising its market cap to $3.13 Trillion, while Microsoft closed at $3.04 Trillion. Nvidia’s partner company, Super Micro Computer Inc., shared strong shipments of its GPUs, primarily driven by the rising global AI demand. 

The pivot from one of the best graphic processing units in the world to the leading maker of AI semiconductors has shown otherworldly returns. As a result, both companies have soared high in revenues, indicating a highly positive outlook to key stakeholders and investors. Nvidia’s market value has increased more than tenfold since 2022, when the pivoting was still in the ideation stage.

The only company left to take over in market capitalization now is Apple, which has a market cap of $3.37 trillion. Microsoft has dipped below Nvidia for the second time this year. Back in June 2024, Nvidia took over both Microsoft and Apple briefly in market cap, becoming the most valued company in the world.

The latest market trends show strong spending in the AI industry, leading to even higher stock growth in the near future. Melius Research analysts shared a visible pattern that semiconductor companies perform best in the 4th Financial Quarter, which means that Nvidia has the potential to increase the gap between Microsoft further. Melius has been holding a price target of $165 for Nvidia shares, a 29% premium over its Monday closing price of $127.72.