Nvidia's (NVDA) market cap touched $1 trillion on Tuesday, making the company the first chipmaker to hit such a high valuation. Nvidia's stock opened more than 4% higher, hovering around $406 per share.
The Santa Clara, California based company joins the ranks of tech giants such as Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN) and Apple (AAPL) in surpassing that market capitalization.
Nvidia's stock has seen a stunning rally — up more than 165% year to date. The chipmaker is at the center of an AI craze thanks to its high-powered graphics cards and server products.
On Monday, Nvidia took the wraps off a slew of new AI-centric products, including a new high-powered supercomputer and a platform that will put generative AI to work in video game development.
Shares skyrocketed more than 26% last Thursday following Nvidia's better-than-expected quarterly results and guidance.
“There’s a war going on out there in AI, and Nvidia today is the only arms dealer out there. So as a result we’re seeing this huge jump in revenues,” Raymond James managing director Srini Pajjuri recently said in a note to investors.
The company says it expects revenue of $11 billion, plus or minus 2% for the second quarter. Wall Street was looking for $7.2 billion.
“We thought if they beat the guidance by about 5%, that’s good enough for the stock to stay where it is. But they’re beating [the] guidance consensus by 50%,” said Pajjuri.
Analysts are overwhelmingly bullish on the stock, with 49 buy recommendations, 8 hold, and 1 sell. The average price target on the stock is $439.73.
Ines is a senior business reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre
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