nvidia reclaims top spot: ai chip demand propels market cap surge

2025-06-04 nvidia

New York, Wednesday, 4 June 2025.
nvidia has once again become the largest U.S. company by market capitalization, reaching a staggering $3.45 trillion valuation. This surge, achieved on Tuesday, 3 June, is directly linked to the insatiable demand for its ai chips. nvidia’s ai dominance continues to reshape the semiconductor industry, even with ceo jensen huang acknowledging that us export restrictions could cost the company billions and cede ground to chinese competitors.

market capitalization milestone

nvidia’s stock closed up by 2.8% on tuesday, reaching $141.22 per share [1]. this performance resulted in a $3.45 trillion valuation, surpassing microsoft’s $3.44 trillion [1]. this marks the first time nvidia has held the top spot since january 24 [1]. the company’s strong financial results and strategic positioning in the ai sector have bolstered investor confidence, driving the stock’s impressive growth [2].

revenue growth and market dominance

nvidia’s recent financial results exceeded expectations, with first-quarter revenue for fiscal year 2026 reaching $44.062 billion, a 69% increase year-over-year [2]. this figure surpassed market estimates of $43.309 billion [2]. oracle plans to purchase $40 billion worth of nvidia chips for its project ‘starry sky’, reflecting nvidia’s ability to secure substantial deals [2]. the company’s technological advancements and market strategies have solidified its position as a leader in the ai chip market [7].

competitive landscape and china market

despite nvidia’s overall success, challenges remain, particularly in the chinese market due to us export restrictions [6]. ceo jensen huang acknowledged that these restrictions could lead to a loss of $8 billion in revenue for the current fiscal quarter [5]. huang has also warned that limiting access to nvidia’s technologies could hinder the united states’ ai platform, potentially shifting global ai talent to competitors [5]. as a result, chinese companies are increasing reliance on domestic ai chip suppliers like huawei [5][6].

strategies for navigating restrictions

to address the challenges posed by export restrictions, nvidia is exploring strategies to remain competitive in the chinese market [6]. this includes developing specialized ai chips that comply with us regulations [6]. nvidia plans to launch a new ai chip, the b40, for the chinese market, priced between $6,500 and $8,000, significantly lower than the restricted h20 model [6]. despite these efforts, nvidia’s market share in china has decreased from 95% to 50% due to export restrictions [6].

long-term outlook and market influence

analysts predict substantial revenue growth for nvidia, projecting annual revenue to exceed $200 billion this year and reach $300 billion by 2028 [5]. nvidia’s strong position in gpu hardware and its cuda ecosystem provide a competitive advantage [7]. nvidia’s role as a key supplier to major ai companies positions it for continued growth, regardless of which specific ai platforms ultimately dominate the market [7]. the company’s innovations and strategic adaptations will be crucial in maintaining its leadership in the rapidly evolving ai landscape [7].

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AI chips Market Cap