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Nvidia Nears Elite Trillion-Dollar Market Cap Club of Apple, Microsoft, Alphabet and Amazon

David Paul Morris | Bloomberg | Getty Images

With its breathtaking surge Thursday, Nvidia could soon land a spot in the most elite Wall Street club, practically overnight.

The chipmaker saw its shares surge 26% on Thursday, bringing its market value to just under the $1 trillion mark at about $950 billion, per FactSet. It was $755 billion at Wednesday's close.

Nvidia would become the fifth publicly traded U.S. company to be currently worth $1 trillion. Apple created the club in 2018. Microsoft, Alphabet and Amazon also now hold the distinction.

"Back in late 2021, we began publishing work suggesting Nvidia would become the first semiconductor company with a trillion dollar market cap," Needham analyst Rajvindra Gill said in a note Thursday. "While there was some peaks and valleys in the interim years, we believe Nvidia is in a position to achieve that valuation over time."

That time could be as early as Thursday.

All eyes on are on Nvidia after it forecast $11 billion in sales for the second quarter of its fiscal 2024 late Wednesday, citing demand for its graphics processors that power artificial intelligence applications like the ones at Google, Microsoft and ChatGPT maker OpenAI. That forecast blew away Wall Street and turned the AI hype driving the stock into real results.

"Customers are 'racing' to meet large language models (LLMs) and generative AI based demand across all major modalities," Gill added. "We see nearly all past headwinds behind us, and expect the company is shipping to true, AI-related demand, near-term."

The company's shares were already up 108% for the year ahead of Thursday's session. Nvidia's shocking sales guidance – more than 50% above the $7.15 billion analysts anticipated for the quarter – has catapulted its market cap forward almost overnight.

Bank of America's Vivek Arya said Nvidia's current-quarter outlook hike is the largest the firm has seen in its coverage and that the company's market cap is on a path to "1 trillion and beyond."

Arya and several other analysts Thursday raised their price target on the stock – with one seeing as much as 64% upside from where it closed Wednesday.

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