The AI Era Unleashed: How NVIDIA’s Stock Boom Reflects The Future Of Tech

If you were doubting whether the age of AI has arrived, NVIDIA’s stock performance this week may have given you second thoughts.

Shares of the Santa Clara, California-based chipmaker rocketed up more than 24% on Thursday, marking one of the top five biggest one-day market cap gains of any publicly traded U.S. company ever. With an approximately $957 billion valuation, NVIDIA may soon join the likes of Apple, Microsoft, Alphabet and Amazon in the highly exclusive $1 trillion+ club.

Year-to-date through today, NVIDIA’s stock has returned more than 160%, compared to the tech-heavy Nasdaq, up around 30% over the same period.


So what’s going on? The U.S. Treasury could run out of cash as soon as next week, the yield curve is flashing a recession and household debt now tops $17 trillion. Is this more “irrational exuberance”?

That’s hard to say in the short term, but over the long term, I believe a bet on semiconductors, artificial intelligence and data centers is looking more and more attractive as AI is set to be applied to countless functions. NVIDIA is just one way to play it.

ChatGPT Leads The Race In Generative AI… For Now

NVIDIA reported blockbuster results in the quarter ended April 30, logging net income of over $2 billion, a 26% increase over the same period last year. Data center revenue hit a record $4.28 billion during the quarter, with founder and CEO Jensen Huang stating that “a trillion dollars of installed global data center infrastructure will transition from general purpose to accelerated computing as companies race to apply generative AI into every product, service and business process.”

Today, when most people hear “generative AI,” they probably think of ChatGPT, the large language model (LLM) launched by OpenAI in November 2022. (Midjourney, a generative AI program that creates images from text, was used to make today’s header image.) As I shared with you before, ChatCPT reached 100 million active users in as little as two months (for comparison’s sake, it took TikTok nine months to reach that goal), and it attracted 1 billion visitors to its website in February.

But ChatGPT is only the start, just as America Online (AOL) was many people’s first gateway into the internet 25 to 30 years ago. Over the coming months and years, I expect to see an eruption of new AI-focused companies and applications.

According to a Pew Research survey, almost 60% of U.S. adults have heard of ChatGPT, but only 14% have actually used it. Just as we saw during the early days of the internet, younger Americans have been far more likely to try ChatGPT than their older peers. Nearly one in three (31%) Americans under 30 reported using the app, compared to only 4% of those age 65 and older.

Younger Americans Have Driven Internet Adoption