Nvidia Is Now World’s Most Valuable Company on AI-Fueled Momentum
Nvidia became the most valuable company in the world on Wednesday, its stock rising more than 4 percent to a new high of $154.10 and catapulting its market capitalization to $3.76 trillion. The chip maker surpassed Microsoft, at $3.65 trillion after a small gain, reported Reuters.
The spike came after a note from Loop Capital that advised that it had lifted its price target on Nvidia to $250 from $175. The firm has a “Buy” rating on the stock and said demand for generative AI may pick up more quickly than expected.
“We’re absolutely now entering the next ‘golden wave’ of generative AI adoption and Nvidia just set up for another meaningful wave of demand beyond prior round expectations,”
— Ananda Baruah, Analyst, Loop Capital
The resurgence of interest in AI has revived investor interest in tech stocks — especially in those related to chips and data infrastructure. Nvidia, the company behind high-powered GPUs employed in AI models, has been a major figure in this wave.
Despite its stunning stock performance, Nvidia does not seem to be overvalued. It is being traded at about 30 times its expected earnings for next year, below its five-year average of 40 times. This means that analysts are becoming more bullish as the company’s profits become more substantial.
Over the last year, Nvidia, Microsoft, and Apple have taken turns being the most valuable company in the market. Microsoft was leading recently, but Nvidia took the lead back this week. Apple shares edged up 0.4 percent on Wednesday, as the company neared a market value of $3 trillion.
After falling to a low in early April — part of a wider sell-off after tariff announcements from Donald Trump — Nvidia’s stock has risen more than 60% since then. Markets have since stabilized, and optimism about potential trade deals has helped remove pressure on the company.
The broader category of tech is trending toward higher valuations, too. The S&P 500 technology index climbed 0.9 percent on Wednesday, to a new all-time high. So far in 2025, it’s 3% higher.
Tesla’s Bets Beyond Self-Driving Cars
Auto industry observers might primarily associate Tesla with electric vehicles, but the company’s next big product could be a robotaxi fleet of autonomous cars, Tesla’s automotive chief said on stage at TC Mobility.
Promising to share “autonomy news” during the autonomy day held on a packed day of Tesla events (which also included a solar-roof-and-terrace party and a driving showcase to investors of the autopilot in their self-driving cars), Andrej Karpathy, Tesla’s chief AI scientist, discussed the company’s full-stack self-driving and computer vision strategy on investors’ day.
We won’t rehash the technical details here, but here are a few highlights: Karpathy says its billion miles of data are a key differentiator for getting to full self-driving.
While much attention has been given to Tesla’s pursuit of a self-driving ride-hailing service, CEO Elon Musk has also spoken of broader AI goals. The Motley Fool noted another such example — Optimus, a human-like robot currently in development for use in factories, and possibly homes.
Nvidia CEO Jensen Huang has recently hyped up the prospects of this market, saying humanoid robotics is a “multi-trillion-dollar industry.” He also pointed to Tesla’s “Optimus project” as one of the initiatives that has piqued his interest.
Tesla envisions two primary use cases for Optimus:
- Factory Work – The robot can assist on production lines, learning through trial and error via machine learning. Over time, it could take on more tasks and never need breaks — boosting factory productivity.
- External Industries – Tesla could sell Optimus to industries that demand physical labor. The robot could be adapted for more generalized environments outside of factories. Musk has even hinted that Optimus might someday become more valuable than Tesla’s car business.
Other firms are entering the space as well. A startup called Figure AI, backed by Nvidia, is developing similar humanoid robots for industrial use. A demonstration video shows these machines collaborating with humans to increase output and reduce repetitive tasks.
What’s Next for Tesla’s Stock?
Tesla’s stock has climbed roughly 30%, buoyed by excitement around its robotaxi launch. The company began testing the service in Texas earlier this week, lifting investor confidence.
However, some on Wall Street believe the recent stock rally may have already priced in short-term enthusiasm around Optimus. Tesla has a track record of rallying on headlines — and that pattern may continue with its robots and robotaxi efforts.
Optimus may just be the start of a major component of Tesla’s future. The key question now:
How fast can the robot scale?
How does it stack up against competition?
Can Tesla turn this into a viable business?
Investors watching Tesla’s AI ambitions will likely want to see more concrete progress before making additional bets.
