Nvidia and TSMC “hit the jackpot” thanks to booming AI demand

The world's leading technology companies such as Nvidia and TSMC "hit the jackpot" from the booming demand for AI, helping their market capitalization skyrocket in October 2024.

Santa Clara, California-based Nvidia led the market capitalization rally among global companies in October, fueled by continued demand for its new supercomputer artificial intelligence chips as more and more companies integrate AI into their daily operations.

The relentless demand for artificial intelligence chips has helped Nvidia's market capitalization grow rapidly.

Nvidia's market capitalization rose 9.3% in October to $3.26 trillion (US), while the company's equipment supplier TSMC saw its market value rise 6.5% to $832.8 billion. The gains came after the world's largest contract chipmaker, based in Taiwan (China), reported better-than-expected third-quarter earnings and provided a strong outlook for AI demand.

Nvidia shares closed up 0.5% today (November 5) at $136.05, marking another milestone in the company's remarkable growth driven by demand for artificial intelligence chips. In a recent appearance on the BG2Pod podcast, Nvidia CEO Jensen Huang shared his vision for a $1 trillion transformation of the global data center infrastructure.

In contrast to Nvidia and TSMC, the market capitalizations of Meta Platforms and Microsoft fell in October, after both companies warned about rising AI costs.

Microsoft, which holds 20% of the cloud services market, has reported some supply constraints related to Nvidia’s Blackwell GPU deliveries. However, the tech giant has maintained a close relationship with Nvidia and proudly touted its position as the first cloud provider to deploy Nvidia’s Blackwell system with an AI server powered by the GB200.

Nvidia will replace Intel on the Dow Jones Industrial Average this week (November 8). The change, announced by S&P Dow Jones Indices, reflects Nvidia's meteoric rise in the semiconductor industry and the company's emergence as a top U.S. chip stock.

Mark Haefele, chief investment officer at UBS Global Wealth Management, remains bullish on AI, advising investors to use short-term volatility as an opportunity to increase exposure to quality AI stocks. Haefele predicts total AI infrastructure spending will increase 50% this year to $222 billion, with another 20% increase expected in 2025 to $267 billion.

“We continue to favor semiconductor and large tech stocks and expect the AI-related portfolio to deliver 35% earnings growth in 2024 and 25% in 2025,” Haefele said.

In Asia, Tencent Holdings' market value fell 9% to $483 billion in October, as Chinese stocks fell further on sluggish economic data, geopolitical tensions and as investors paused to assess government support measures.

US pharmaceutical giant Eli Lilly's market capitalization also fell 6.45% to $787.6 billion last month as quarterly sales of its popular diabetes and weight-loss drugs missed Wall Street estimates, sending the company's shares sharply lower.

Source: https://www.baogiaothong.vn/nvidia-va-tsmc-vo-bam-nho-bung-no-nhu-cau-ai-192241105193415112.htm