Nvidia market cap crosses $5 trillion as AI boom powers the stock

Nvidia has become the first company to ever reach a market capitalization of $5 trillion. The AI chipmaker's stock opened at $207.86 per share on Wednesday, putting it above the historic milestone.

It comes just three-and-a-half months after Nvidia first topped a $4 trillion market cap, underscoring the breathtaking pace of the company's growth in recent years. In October of 2022, Nvidia was valued at just $336.9 billion.

Nvidia this week is holding its annual GTC summit, brining the closely watched conference to Washington for the first time. It has already made several announcements there, including a $1 billion investment into Nokia. The company also discussed quantum computing and what it called a digital blueprint for AI factories.

“Every time I say ‘quantum,’ the stock price goes up," joked Nvidia CEO Jensen Huang. "Quantum, quantum, quantum.”

Huang is now headed to South Korea, where he is expected to meet with President Donald Trump to discuss Nvidia's future in China, which is also likely to be also a topic in trade talks between Trump and President Xi Jinping of China.

Nvidia is the first to $5 trillion and was the first company to hit a $4 trillion market cap. But before that, Apple was king of the milestones. The iPhone maker was the first to top $1 trillion, $2 trillion, and $3 trillion. Its growth has slowed, though, as it has struggled in the artificial intelligence space.

Read more: Is the AI boom actually a bubble? Here’s everything you need to know

Nvidia stock is up more than 45% so far this year. Over the past five years, the shares have rocketed more than 1,500%. The Wall Street Journal noted that Nvidia is now worth more than all the S&P 500's energy, real-estate and materials stocks combined.

While shareholders might celebrate the $5 trillion mark, it's likely to further stoke fears that the AI boom has overvalued stocks and created a market bubble.

In July, Torsten Slok, chief economist at Apollo Global Management, warned that AI stocks are even more over-valued than dot-com stocks were in 1999. Alibaba Group chair Joe Tsai has also warned that U.S. AI stocks are in a bubble, as has longtime tech exec (and former C3.ai CEO) Tom Siebel.

Not everyone agrees. Goldman Sachs, earlier this month said in a note to investors that it believes the AI story is just getting started – and that the investments that seem huge today will be dwarfed by the benefits AI will deliver.

"The enormous economic value promised by generative AI justifies the current investment in AI infrastructure and overall levels of AI investment appear sustainable as long as companies expect that investment today will generate outsized returns over the long run," Goldman analysts wrote.

Read more: Is the AI boom actually a bubble? Here’s what analysts are saying

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