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Nvidia Corporation, a trailblazer in graphics processing and artificial intelligence (AI), continues to lead as a top semiconductor company in the US. Nvidia’s diverse technology portfolio spans GPUs for gaming, automotive platforms, and AI computing solutions. Remarkably, Nvidia has also solidified its position as one of the “Magnificent Seven” tech giants, a testament to its influential role and persistent innovation in the tech industry.
Here, we explore Nvidia’s business dynamics, stock performance, and what investors should know moving forward.
Key Points
- NVIDIA Corporation, founded in 1993 and known for inventing the GPU in 1999, has become a leading force in graphics processing and artificial intelligence, growing to a market-leading semiconductor company in the U.S. by 2020.
- The company’s business segments include graphics processing units (GPUs) for gaming and enterprise, cloud-based visual and virtual computing, automotive platforms, and data center and AI computing solutions, reflecting a diverse portfolio in technology.
- Despite a flat annual revenue in FY2022, NVIDIA has demonstrated significant growth potential due to its early investment in AI technology, with a recent stock surge and strategic partnerships aimed at integrating AI into various industries.
About NVIDIA Corporation
History of the company [1]
NVIDIA was founded in 1993 by Jensen Huang, Chris Malachowsky, and Curtis Priem on the belief that the personal computer would become a leading consumer device for enjoying games and multimedia.
Over the next two years, the company made successful forays, notably launching their first graphics card, having popular video game Virtua Fighter ported to run exclusively on NVIDIA products, and launching DirectX drivers for Microsoft.
1997 brought NVIDIA’s first major milestone. The company launched the world’s first 128-bit 3D processor, and shipped 1 million units within four months. Shortly after, in 1999, NVIDIA invents the Graphics Processing Unit (GPU), setting it on the path to reshape the industry. In the same year, the company went public, listing on the NASDAQ for USD$12 per share.
In 2002, after shipping its 100 millionth processor, NVIDIA was named the fastest growing company in America by Fortune. That feat would be repeated in 2007 when the company achieved its first quarter with revenue exceeding USD$1 billion, earning the title “Company of the Year” by Forbes magazine.
In 2011, the company shipped its 1 billionth graphics processor. By now NVIDIA had become an unstoppable juggernaut, with its innovative products winning accolades not just in gaming, but also in visual effects and entertainment, mobile and consumer computing, super-computing, and AI.
NVIDIA cemented its dominant market position in 2020, when it became the most valuable semiconductor company in the U.S. by market cap.
NVIDIA’s Share Price 2024
Here’s a look at how NVIDIA has been performing over the past year:
Since the beginning of 2023, NVIDIA Corporation’s stock price has demonstrated an unbroken upward trajectory. NVIDIA’s shares were trading at a price of $143.15 at the outset of January 2023, fast forward to 2024, the share price reached an all-time high of $926.69 on 7 March 2024 — a 547% gain. Just over the past year alone, if you held $1,000 worth of NVIDIA’s shares in January 2023, that would be worth at least $6,000 today.
As of 16 February, NVIDIA’s market capitalisation stands at $1.8 trillion. This surpasses Alphabet’s $1.77 trillion and Amazon’s $1.75 trillion, securing its position as the third most valuable company in the US [2].
Business segments [3]
NVIDIA’s main business is in graphics processing, led by its GeForce line of GPUs for gaming consoles and PCs. The company also caters to enterprise design via its Quadro/NVIDIA RTX GPUs, and offers GRID software for cloud-based visual and virtual computing, along with automotive platforms for infotainment systems.
Besides graphics, NVIDIA’s other major business segment is in compute and networking. This is made up of the company’s Data Center platforms as well as systems for AI, high-performance computing, and accelerated computing.
Also under this segment, NVIDIA provides networking and interconnected solutions, automotive AI Cockpit, autonomous driving development agreements and vehicle solutions, cryptocurrency mining processors, and Jetson for robotics and other embedded platforms.
NVIDIA is headquartered in Santa Clara, California, United States. It has an estimated staff size of approximately 26,000 [4].
About the stock NVDA
NVDA trading information
- Primary exchange: NASDAQ
- Ticker: NVDA
- Country: US
- Currency: USD
- Trading hours:
- Main: 9.30am to 4pm ET, Mon to Fri
- Pre-market: 4am to 9.30am
- After-market: 4pm to 8pm
When was NVDA listed?
NVDA was listed on the NASDAQ on 22 January 1999 at a price of $12 per stock [5]. Adjusted for stock splits, the price of the stock was $0.25 at launch.
At the time of writing, NVDA is trading at $884.55, representing a return of 3537.2x since its IPO. The stock’s highest price was seen on 7 March 2024, when it closed the day at $926.69 [6].
Stock splits
NVIDIA has announced a series of five stock splits since going public [7]. The total number of NVDA shares outstanding is estimated to be 2.483 billion [8].
| Date | Split |
| June 2024 | 10 for 1 |
| July 2021 | 4 for 1 |
| September 2007 | 3 for 2 |
| April 2006 | 2 for 1 |
| September 2001 | 2 for 1 |
| June 2000 | 2 for 1 |
Dividends
NVDA is a dividend-paying stock, and dividends are paid out every quarter. In 2023, the company paid out $0.04 per share over four quarters [9].
Latest developments investors should note
Here are some developments that investors looking to trade or invest in Nvidia should be aware of:
Nvidia Replaces Intel as New Entrant in Dow Jones Industrial Average [10,11,12]
Nvidia is set to replace Intel in the Dow Jones Industrial Average (DJIA) on 8 November 2024, marking a significant shift in the semiconductor industry. Nvidia’s dominance in AI chip technology and its soaring stock performance, driven by a 10-for-1 stock split in June, made it eligible for inclusion in the prestigious index.
With a market cap of $3.39 trillion, Nvidia is now one of the most influential tech companies in the US, reflecting the growing importance of AI in the tech landscape. This move benefits Nvidia and its shareholders, as mutual funds and ETFs that track the Dow will need to buy shares of the company, likely driving up demand and boosting the stock price.
Meanwhile, Intel’s declining market share and struggles in the AI sector contributed to its removal, making way for Nvidia as the new leader in the semiconductor space.
Nvidia Q2 Earnings Expected or Unexpected? [13,14,15,16]
Nvidia has once again posted strong financial results, reporting a second-quarter revenue of $30.04 billion, which exceeded Wall Street’s expectations of $28.86 billion. However, because this outperformance was slimmer than in previous quarters, Nvidia’s stock dropped over 8% in after-hours trading.
Despite surpassing earnings predictions and projecting a robust third-quarter revenue of $32.5 billion, Nvidia’s guidance did not meet the highest expectations on Wall Street, which anticipated revenues as high as $34 billion. This has tempered investor enthusiasm and raised concerns about Nvidia’s ability to maintain its rapid growth during the ongoing AI boom.
CEO Jensen Huang highlighted the strong demand for Nvidia’s AI chips, especially the current Hopper and the upcoming Blackwell architectures. Despite the excitement around Blackwell’s release, reports of potential delays and production issues have cast doubts on its immediate impact. Huang reassured investors that Blackwell is expected to generate “several billion” in revenue starting in the fourth quarter, but he also acknowledged that production challenges have impacted gross margins.
Nvidia Q2 Earnings 2024 [17,18]
Nvidia, now the world’s most valuable company after surpassing Microsoft, exceeded Wall Street’s expectations in its Q1 earnings report, with net income surging more than sevenfold to $14.88 billion.
Looking ahead to the upcoming Q2 results, Nvidia is expected to deliver adjusted earnings per share (EPS) of $0.65 on revenue of $28.7 billion. This would mark a significant growth of 139% in EPS and a 113% increase in revenue compared to the same quarter last year, when EPS stood at $0.27 and revenue reached $13.5 billion.
As excitement builds around this earnings report, investors and traders are keeping a close eye on Nvidia’s performance. The company’s stock has already surged by more than 163% year to date and 60% over the past six months.
The closing price of Nvidia as of 28 August 2024, was $128.30.
NVIDIA becomes third most valuable company on Wall St – surpassing Alphabet [19]
On 14 February 2024, NVIDIA overtook Google’s parent company, Alphabet, to secure the third spot as the most valuable U.S. firm, boasting a market capitalisation of $1.825 trillion, surpassing Alphabet’s $1.821 trillion. The increase in NVIDIA’s stock by 2.46% signifies investor excitement preceding its forthcoming quarterly report.
With a stronghold on approximately 80% of the high-end AI chip market, NVIDIA has seen its stock surge by 47% this year, following a tripling in 2023.
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The information has been prepared by Vantage UK as of 6th November 2024 and is subject to change thereafter. The information is provided for educational purposes only and doesn’t take into account your personal objectives, financial circumstances, or needs. It does not constitute investment advice. We encourage you to seek independent advice if necessary. The information has not been prepared in accordance with legal requirements designed to promote the independence of investment research. No representation or warranty is given as to the accuracy or completeness of any information contained within. This material may contain historical or past performance figures and should not be relied on. Furthermore estimates, forward-looking statements, and forecasts cannot be guaranteed. The information on this site and the products and services offered are not intended for distribution to any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
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The information has been prepared as of the date published and is subject to change thereafter. The information is provided for educational purposes only and doesn't take into account your personal objectives, financial circumstances, or needs. It does not constitute investment advice. We encourage you to seek independent advice if necessary. The information has not been prepared in accordance with legal requirements designed to promote the independence of investment research. No representation or warranty is given as to the accuracy or completeness of any information contained within. This material may contain historical or past performance figures and should not be relied on. Furthermore estimates, forward-looking statements, and forecasts cannot be guaranteed. The information on this site and the products and services offered are not intended for distribution to any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
