Nvidia Corp. experienced a notable surge on Tuesday, with shares rising by 2.1% to achieve a record high. This marked the 10th consecutive session of gains for the Santa Clara, California-based company, equaling its longest-ever streak of advances.
The catalyst for this upward trajectory was an update to Nvidia’s artificial intelligence processors. Throughout its latest rally, the company’s shares have ascended by 22%, translating to an impressive addition of approximately $219 billion in market value, as per Bloomberg data. Competitors find themselves scrambling to devise alternatives in a bid to challenge Nvidia’s formidable position in the AI domain.
This surge contributes to Nvidia’s stock being the top performer on both the Nasdaq 100 and S&P 500 indexes, having surged over 240% in the current year. The prevailing AI-driven frenzy has been a key factor propelling these rallies. Notably, this recent upswing aligns with a broader rebound in technology stocks, buoyed by optimism that Federal Reserve interest rates have reached their peak.
A pivotal aspect of Nvidia’s positive momentum is the introduction of its updated chip, named the H200. This chip incorporates the use of high-bandwidth memory, specifically HBM3e, enhancing its capability to handle the substantial data sets integral to AI development and implementation.
Wolfe Research analyst Chris Caso commented on this development, noting that Nvidia’s decision to refresh its datacenter GPUs is indicative of the company accelerating its product cadence in response to the burgeoning AI market and evolving performance requirements. This, in turn, bolsters Nvidia’s competitive advantage.
The existing version of Nvidia’s processor, recognized as an AI accelerator, is already experiencing high demand. The company’s commitment to a swift product launch with the H200 in mid-2024 is anticipated to fortify its position, with Bloomberg Intelligence analyst Kunjan Sobhani suggesting that this new AI processor, equipped with high-bandwidth memory, could potentially become the top-performing GPU in the market, setting a higher standard for the competition.
Notably, Nvidia faced challenges last month when new US regulations prohibited the sale of its cutting-edge AI chips to China. Despite this, the company is scheduled to report its earnings on November 21, providing further insights into its financial performance amid these dynamic market conditions.
