Nvidia’s stock is on the brink of reaching a new all-time high as investor enthusiasm surrounding the ongoing artificial intelligence (AI) boom continues to surge. As of midday Wednesday, shares were stable at $133, challenging their previous record closing price of $135.58 set back in June.
On Tuesday, Nvidia witnessed its fifth consecutive day of gains, climbing 4% to close at $132.89—a remarkable 12% increase from the prior week. This upward trajectory is attributed to a plethora of positive developments for the AI powerhouse. Wall Street analysts are firmly standing behind Nvidia, reaffirming their buy recommendations. KeyBanc recently disclosed projections indicating Nvidia’s revenues from its highly anticipated Blackwell chips could soar to $7 billion in the fourth quarter, all while demand for the company’s older graphics processing units (GPUs) remains robust.
Further reinforcing the company’s growth prospects, Nvidia recently demonstrated the strength of its software capabilities during its AI Summit in Washington, D.C. In conjunction, it was revealed that Nvidia and Foxconn have plans to construct the largest supercomputer in Taiwan, a significant step amid a backdrop of heightened trade tensions with China. In line with this, Foxconn also unveiled details of a massive factory in Mexico dedicated to assembling Nvidia servers that will leverage the new Grace Blackwell chips.
Despite previous fluctuations following its second-quarter earnings report, which did not meet some investor expectations, Nvidia has managed an impressive recovery. Negative sentiment surrounding potential disruptions in demand from China, as reported in August, has shifted significantly. This volatility was further exacerbated by a subpoena from the U.S. Department of Justice, which Nvidia has since denied. However, the latest performance in the semiconductor sector, highlighted by TSMC’s positive sales—exceeding Wall Street’s forecasts—has reinvigorated investor confidence in Nvidia’s stock.
Patrick Moorhead, CEO of Moor Insights and Strategy, encapsulated the current market sentiment: “AI is hot,” indicating that significant growth in the AI data center sector is anticipated over the next year. The semiconductor industry as a whole reflected a robust performance, with sales rising 28% year-over-year in August and 15% from July, according to recent data from WSTS and analyzed by JPMorgan.
In a related update, Young Liu, chair of Foxconn, spoke to the overwhelming demand for Nvidia’s AI chips, noting the company’s plans to amplify production to meet what he described as “crazy” demand. Nvidia’s CEO, Jensen Huang, recently remarked on the “insane” demand for their new Blackwell chips during a CNBC interview, further signaling a strong future for the company.
As market dynamics continue to favor AI-related investments, Nvidia stands poised for potential record-breaking achievements, driven by solid fundamentals and an accelerating demand landscape within the technology sector. Investors and enthusiasts alike will be monitoring closely as Nvidia ventures toward its next milestone, solidifying its position as a leader in the AI and semiconductor industries.