Today's Apple of AI Nvidia's leap in value to $2tn makes sense right now, but chips can fall

Last Friday, Nvidia became the fifth publicly traded L company ever to surpass $2tn in valuation, just nine months after it became the ninth to break $1tn. Apple, Microsoft and Google took two years to cross that gap (although all three had the Covid pandemic in between the milestones).

- Alex Hern

The simple reason for the explosion in valuation is that Nvidia is the company to bet on if you want to invest in AI. Google and Microsoft already have sky-high valuations, OpenAI isn't publicly traded and, while everyone and their dog is throwing a large language model up on a website and calling it innovative AI, it's hard to tell who has staying power.

But Nvidia isn't making promises about future breakthroughs. The company is printing money now. Its chips, mostly shipped in the form of GPUs, a special type of processor initially developed for the needs of PC gamers, are indispensable to companies at the sharp end of the AI revolution.

In January, Mark Zuckerberg spoke about Meta's plans to build the "world's fastest AI supercomputer" - and backed his words up with a commitment to buy 350,000 of Nvidia's fastest chips. Just one of the chips Zuckerberg committed to buy by the end of this year costs around $30,000 (£24,000). That $10bn investment in AI is pure cost for Meta, and pure revenue for Nvidia.