Synopsis
Chipmaker Nvidia's market value crossed $5 trillion as demand for its AI chips surged. Other chipmakers like AMD and Intel also saw significant stock increases. The rally is driven by rapid AI infrastructure buildout, outpacing chip supply. Read on to find out more.Listen to this article in summarized format
Advanced Micro Devices (AMD) climbed over 13%, while Intel Corporation jumped more than 23% after reporting strong earnings.
Even so, Nvidia continues to dominate investor attention. Its stock has climbed more than 14 times since the end of 2022, underlining the scale of optimism around AI-led expansion.
What is powering the rally?
At the heart of the surge is the principle of demand and supply: there aren’t enough AI chips to meet exploding demand. Data centres, cloud companies, and even governments are rushing to build AI systems, and Nvidia’s GPUs are right at the centre of it all.
Especially, its Blackwell and B300 chips, which have become central to the current demand cycle, with customers placing large-scale orders.
Partnerships are adding to this, too. Its collaboration with Google on AI systems and with its work with nuclear startup Oklo Inc. shows how the race is no longer just about chips. It’s also about power and infrastructure. Nvidia is gradually turning into a one-stop shop for AI needs.
Financially, the company is already operating at a different scale. Revenue has crossed $215.9 billion, while profits exceed $120 billion. These figures are among the highest in the industry. Market participants are also factoring in future growth, especially with heavy AI-related spending expected to continue through 2027 and beyond.
On the financial front, the company is already on a different level. It has brought in more than $215.9 billion in revenue and over $120 billion in profit, among the highest in the industry. Market participants are also factoring in future growth, especially with heavy AI-related spending expected to continue through 2027 and beyond.
How rivals like Intel are catching up
The broader AI wave is lifting multiple players, but the gap between them remains.
Seems like Intel is making a comeback. Its 23% jump, the strongest since 1987, followed upbeat earnings, pointing to fresh momentum. Backed by nearly $20 billion in US government support, the company is also pushing to expand domestic manufacturing, a move that could shift the competitive balance over time.
AMD is also gaining ground, particularly in the data centre GPU space. Its 13% rise signals growing confidence, though it still trails Nvidia in areas such as software ecosystems and integration.
Other firms, including Taiwan Semiconductor Manufacturing Company and Arm Holdings, are benefiting from the broader trend. Qualcomm has also advanced, gaining around 11%.
Even with these gains, Nvidia’s role is distinct. It remains the primary force shaping the AI-driven surge, rather than just participating in it.
Strong growth outlook
A recent report from Goldman Sachs projected a significant expansion in semiconductor revenues, stating that they "expect global revenue growth of 49% from current levels by the end of 2026.
The report added that AI hardware revenues could exceed $700 billion by the fourth quarter of 2026, highlighting the magnitude of ongoing investments.
Data centre revenues are expected to grow rapidly in the coming years. Some estimates indicate Nvidia could move closer to $1 trillion in annual revenue before the end of the decade.
Challenges ahead
Despite strong momentum, risks are emerging. Large customers such as Google and Meta Platforms are developing their own AI chips, which may reduce reliance on Nvidia over time.
Geopolitical tensions also remain a concern. US export controls are already restricting Nvidia’s ability to sell to China. Recent company guidance assumes no data centre revenue from that market. That is a notable shift.
There are also legal uncertainties. A class-action lawsuit related to earlier disclosures around crypto mining could result in financial penalties.
