Nvidia became the world’s most valuable company on Wednesday after its share price rose to $154.10, pushing its market value to $3.76 trillion. Reuters The chipmaker said it overtook Microsoft.
The rise follows a memo from Loop Capital, which increased Nvidia’s price target from $175 to $250. The company maintained its “buy” rating and said demand for generating AI could grow faster than expected.
“We enter the next ‘golden wave’ of Gen Ai Ai adoption, with Nvidia on the front end of another material leg that is stronger than expected demand,” says Loop Capital analyst Ananda Baruah.
Renewed interest in AI has sent investors back to high-tech stocks, particularly companies involved in chips and data infrastructure. Nvidia, which designs high-performance GPUs used in AI models, was a key figure in that trend.
Despite the strong performance of the stock, its valuation does not appear to be over-growing. Nvidia will trade at about 30 times its forecast revenue for next year, below the five-year average of 40 times. This suggests that analysts are increasing their forecasts as the company continues to provide greater profits.
Nvidia, Microsoft and Apple have been spinning in and out of all top spots of market value over the past year. Microsoft has made some recent advances, but Nvidia has regained its lead this week. Apple’s shares rose 0.4% on Wednesday, bringing its valuation to around $3 trillion.
Nvidia’s stock has risen in value by more than 60% since reaching lows in early April. That decline came during a wider sale caused by a tariff announcement from Donald Trump. Since then, the market has been stable and they want trade transactions that can reduce some of the pressure on the company.
The broader tech sector is also moving towards higher ratings. The S&P 500’s technology index rose 0.9% on Wednesday to a new record. In 2025, it has earned nearly 6% so far.
Tesla’s AI push surpasses self-driving cars
Tesla is best known for its electric vehicles, but in addition to building AI capabilities and the Robotaxi project, the company also tackles lesser-known work in robotics.
While many are focusing on the push for Tesla to launch self-driving ride services, CEO Elon Musk also talks about the wider future of AI. As A miscellaneous fool Highlighted, one example is Optimus, a humanoid robot developed by the company for its factory, potentially domestic use.
Nvidia CEO Jensen Huang has recently highlighted the potential of this market, calling Humanoid Robotics a “multi-billion dollar industry.” He mentioned Tesla’s Optimus Project as one of the efforts that caught his attention.
Tesla looks at two main uses for Optimus. First, the robots are trained with machine learning and can assist the company’s own production line. Over time, it can take over more tasks, work without breaks, and increase factory power.
Second, Tesla was able to sell Optimus to other industries where labor is physically demanding. The robot can be adapted to more routine settings outside the factory. Musk says Optimus is ultimately more valuable than the company’s automotive business.
Other companies also work in this field. An Nvidia-backed startup, Diagram AI, is developing similar humanoid robots for use in factories. The demo video shows how the machine works with people, increasing the power output and reducing repetitive tasks.
What’s next for Tesla stock?
Tesla’s stock price rose almost 30%, partly due to Robotaxi’s rollout. The company began testing its services in Texas this week.
However, some analysts say its inventory may already be at its peak due to the short-term excitement of Optimus’s announcement. Tesla tends to move based on headings, and the same pattern could be applied to robots and Robotaxi projects.
Optimus could be a key part of Tesla’s future, but that’s too early. There remain important questions about how quickly the robot can scale, how it can compare with other options, and whether the company can turn the project into a real business.
Investors looking at Tesla’s AI plans may want to see more progress before placing a new bet.
(Photo: Mariia Shalabaeva)
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