Nvidia vs Microsoft: Which AI heavyweight will hit $4 trillion first?
Artificial-intelligence heavyweights Microsoft and Nvidia continue to battle to be the world's most valuable company by market capitalization, after surpassing the $3 trillion milestone last year.
Twice this month, Microsoft unseated Nvidia as the most valuable company, but Nvidia regained its title Wednesday. On Thursday, its shares clinched a four-day winning streak and record close of $155.02. That put Nvidia's market value at $3.782 trillion, ahead of Microsoft's $3.697 trillion.
Now, it's just a matter of who gets to $4 trillion first. Wedbush analysts say we will find out soon enough.
'We believe both Nvidia and Microsoft will hit the $4 trillion market cap club this summer and then over the next 18 months the focus will be on the $5 trillion club," the analysts wrote in a research note Friday.
They characterize Nvidia and Microsoft as the so-called poster children of the AI revolution, which they say 'represents the biggest tech transformation in over 40 years."
After all, Nvidia's momentous ascent has been the stuff of dreams for AI fans. Interest in AI reached new heights when ChatGPT launched in late 2022, and Nvidia's powerful graphics processing units emerged as a solution to power the technology. Today, Nvidia is widely regarded as the chip maker of choice for hyperscalers, Microsoft included.
Nvidia stands at the forefront, 'as they are the only game in town with their chips the new gold and oil." The company's dominance allows CEO Jensen Huang to have 'the best perch and vantage point to discuss overall enterprise AI demand," the analysts contended.
Microsoft's AI story has been equally compelling for bulls. The company once known for the Windows operating system and Microsoft Office suite has rebranded itself into an AI enterprise—if the language in its latest earnings report is any indication. Azure, Microsoft's flagship cloud computing platform, offers a suite of tools that allow developers to build and deploy AI applications.
Its footing in the cloud computing space, alongside other hyperscalers like Alphabet, is a key advantage: The need for cloud compute is only expected to grow as the adoption of AI, a power-intensive technology, ramps up.
As more AI use cases are identified, the Wedbush team expects Amazon Web Services and Google Cloud Platform to 'acquire AI-capable chips, build AI-capable service offerings, and sell those services into their respective installed bases."
Nvidia stock rose 1.3% to $157.11 on Friday. Wedbush maintains an Outperform rating and $175 price target on the shares.
Microsoft was flat at $497.67. The firm rates Microsoft at Outperform with a $600 target price.
Wedbush Fund Advisers launched the Dan IVES Wedbush AI Revolution ETF earlier this month, which includes Microsoft, Nvidia, and the other Magnificent Seven tech stocks.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
First Post
22 minutes ago
- First Post
Big Tech's AI Obsession Is Shaking Wall Street Vantage with Palki Sharma
Big Tech's AI Obsession Is Shaking Wall Street | Vantage with Palki Sharma | N18G Wall Street's AI party may be hitting its first reality check. For 18 months, the 'Magnificent 7' — Apple, Microsoft, Amazon, Alphabet, Meta, Tesla, and Nvidia — have powered the S&P 500. But cracks are showing. A blunt MIT study revealed that 95% of AI pilot projects fail, sparking panic selling. Nvidia, Meta, Palantir, and others tumbled as investors questioned whether AI is truly delivering returns or just burning cash. Big Tech plans to spend $400B on AI infrastructure in 2025 — but will hype keep pace with reality? Is this the start of the AI bubble bursting? Palki Sharma tells you. See More
Time of India
41 minutes ago
- Time of India
AI may not be the job killer many feared: Signs of a balanced future with automation
Early Fears of Job Losses More Nuanced Outlook from Industry Leaders You Might Also Like: AI is choosing AI over humans: New study sounds alarm on what this bias means for human intelligence and creativity Gradual Shifts Instead of Dramatic Losses The rise of artificial intelligence has sparked intense debate about its impact on employment . While early predictions focused on mass layoffs and large-scale worker displacement, recent research and labor data suggest a more measured reality. Instead of wiping out entire professions, AI may be gradually reshaping roles, creating demand for new skills, and driving efficiency in ways that could benefit both workers and businesses over AI tools such as ChatGPT entered the mainstream in 2022, business leaders quickly warned of potential disruption. Executives from Amazon, Anthropic, and the International Monetary Fund (IMF) predicted that automation could displace large numbers of workers, particularly in white-collar and administrative CEO Andy Jassy indicated that AI could reduce the company's corporate workforce, while Anthropic CEO Dario Amodei went further, suggesting that half of entry-level office jobs might disappear. The IMF similarly cautioned that AI adoption could result in a 'painful transition' for many all leaders share this bleak outlook. OpenAI CEO Sam Altman has noted that while some jobs—especially in customer service—are highly vulnerable, society rarely experiences job losses at the scale predicted. Altman has offered one of the starkest assessments of AI's potential disruption. Speaking at a Federal Reserve conference, he said generative AI is not just transforming the workplace but could transform significant parts of it. He singled out customer support as the sector most vulnerable, noting that AI systems are already capable of handling everything from basic queries to complex problem-solving without human acknowledging the potential for AI to support diagnostics and patient care, he made clear that he would not want medical treatment without human oversight. His remarks highlight the limits of automation in areas requiring empathy, judgment, and ethical decision-making. In this sense, AI may serve as a co-pilot for professionals rather than a full replacement, particularly in high-stakes suggested that many of the new roles created may prove more rewarding than those CEO Jensen Huang has argued that AI will affect every role but does not necessarily spell mass job loss. Instead, he emphasized that workers risk being left behind only if they fail to adopt AI widespread concern, the numbers do not currently show mass job losses. Research from the Economic Innovation Group found no evidence of large-scale labor disruption tied to AI adoption. Unemployment among AI-exposed occupations has not spiked, and firms with AI-related roles are still maintaining strong employment levels. Martha Gimbel of Yale University's Budget Lab underscored this, noting that the impact of AI has not yet registered in labor market from MIT's GenAI Divide: State of AI in Business 2025 also point to a more selective impact. Workforce reductions have been limited to customer support and administrative processing—areas that were already at risk before AI's rise. In contrast, industries such as healthcare, energy, and advanced manufacturing have reported no significant cutbacks. The report concluded that generative AI's influence on employment remains gradual and than eliminating jobs outright, AI is transforming what employers value in candidates. Companies are now prioritizing AI literacy, with some reporting that new graduates often outperform experienced professionals in this area. Experts believe AI will increasingly handle repetitive tasks, allowing workers to focus on problem-solving, creativity, and higher-value to Daniel Zhao, chief economist at Glassdoor, the long-term outcome is still uncertain. The rapid pace of AI development means its full effect on the labor market may only be felt in the coming years. Columbia Business School professor Stephan Meier expects that AI will transform tasks within jobs rather than eliminate entire positions, but the pace of this change will depend on how quickly businesses integrate the fears of widespread AI-driven unemployment remain strong, current evidence suggests a more balanced picture. The technology is beginning to alter tasks and hiring priorities, but its broader disruption has yet to materialize.
Time of India
an hour ago
- Time of India
Are Nvidia stocks the single biggest factor behind S&P 500, US stock market's swing? Investors will be surprised to know details
Nvidia and Federal Reserve's announcement related to interest rate cut are perhaps the most pivotal factors that could trip up the runaway stock market. Chip producer Nvidia's financial report, which is scheduled to be released on Wednesday, is expected to produce the S&P's biggest one-day reaction over the next month. Nvidia Impact on US Stock Market As Nvidia has grown, swelling to a $4 trillion valuation last month, so has its weighting in the S&P 500. It now makes up almost 8 per cent of the index. The last time Nvidia reported earnings, in May, its stock rose 3.25 per cent and the S&P 500 rose 0.4 per cent. After reporting earnings in February, Nvidia sank more than 8 per cent and the S&P 500 dropped 1.6 per cent. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like This is The Cost Of The New Walk-In Shower in Portland. Kohler Safe Showers Learn More Undo Nvidia has led rivals in the race to dominate the high-powered chips used to power AI, and next week investors are looking for signs that the relentless demand for Nvidia's products will continue. The company's earnings could help answer another big question looming over the stock market: whether there is a bubble in AI, as some have speculated this week. Other large companies in the index, like Apple and Microsoft, are also tied to the AI theme, so Nvidia's financial results are likely to affect these other big stocks as well. Live Events "It's always a big deal," said Stacy Rasgon, an Nvidia analyst at Morningstar, joking that he had perhaps become "jaded" by the frequency of big moves in Nvidia's stock price. US Fed Impact on Wall Street On Friday, the Federal Reserve chair delivers a hotly anticipated speech at Jackson Hole in Wyoming. Not long after that, the Labor Department will release the latest update on hiring, and then there's an important reading on inflation. The forecast for that market move is reflected in recent options activity -- derivatives that give an investor the right to buy or sell a stock, or an index of stocks, at a future date for a preset price. Investors use options to make bets on the direction of the market and to protect against the potential for the market to move against them. According to S&P 500 options data from Citi Global Markets, investors are positioned for a 0.8-percentage-point move -- in either direction -- on Friday, depending on what the Fed chair, Jerome Powell, says in his speech at the central bank's annual conference at Jackson Hole. Prices for next Thursday -- the first chance investors have to react to Nvidia's earnings released the night before -- imply a move in the index of 0.9 percentage points in either direction. The Fed still looms large over financial markets, with policy decisions that can move markets around the world. But the fact that quarterly results from one technology company focused on artificial intelligence can match, in the view of equity investors, the impact of some of the most widely tracked economic data and central bank activity reflects the significant influence that a handful of behemoth tech companies have on today's stock market. "On a relative basis, Nvidia's earnings is the largest event for the S&P 500 for the next month," said Stuart Kaiser, an equity strategist at Citi. "For equity investors," he added, "particularly in the S&P 500, the AI theme, and the impact of that on returns, is on par with the Fed now." For comparison, when Powell spoke at Jackson Hole last year, the S&P 500 rose a little more than 1 per cent. The year before, his remarks were followed by a 0.7 per cent increase in the index. Powell's address this week could shift investors' expectations for monetary policy and cuts to interest rates, both of which are crucial inputs for modeling the path ahead for the economy and stock market. The Trump administration has repeatedly complained about the Federal Reserve's keeping rates elevated, calling on the central bank to lower them rapidly, which would probably make borrowing cheaper and accelerate the economy. It would also help President Donald Trump fulfill a campaign promise to bring interest rates down. So far, the Fed has resisted, warning that rapidly lowering interest rates risks heating up the economy at the wrong time, potentially stoking inflation and raising prices for consumers. FAQs Q1. Who is US Fed Chairman? A1. US Fed Chairman is Jerome Powell. Q2. What is valuation of Nvidia? A2. As Nvidia has grown, swelling to a $4 trillion valuation last month, so has its weighting in the S&P 500. It now makes up almost 8 per cent of the index. The last time Nvidia reported earnings, in May, its stock rose 3.25 per cent and the S&P 500 rose 0.4 per cent. After reporting earnings in February, Nvidia sank more than 8 per cent and the S&P 500 dropped 1.6 per cent.
