AI makes NVIDIA the 6th highest-valued company in the world 

Nvidia AI
  • NVIDIA doubled its annual profits from mining Ethereum in 2021.
  • The company has launched a new chip dedicated to training new AIs.

NVIDIA, one of the largest manufacturers of graphics cards on the planet, has managed to enter the top 6 of the companies with the best market capitalization in the world, thanks to the sales of its new chips oriented to artificial intelligence (AI). 

In its first quarter 2023 earnings report released on May 24, NVIDIA reported earnings of nearly $7.9 billion, an increase of 19% from last quarter. This increase allowed NVIDIA’s market capitalization to reach over USD 940 billion, placing it as the sixth most-valued company in the world.

The increase is not accidental, since the company has focused its efforts on its new A100 chips, oriented towards the field of AI. This type of GPU is exclusively for AI training and use. It is estimated that ChatGPT, the most famous and most widely used AI of the moment, uses between 10,000 and 30,000 of these A100 GPUs to operate.  

graph shows increase in nvidia market capitalization
After the publication of the earnings report, NVIDIA shares rose 20%. Source: TradingView.

For years, NVIDIA made good returns thanks to the cryptocurrency business. In May 2021, the Market Times reported that the company’s profits had doubled thanks to GPU sales, the demand for which came from the Ethereum mining sector, and to a lesser extent other cryptocurrency protocols, such as Ethereum Classic, and Ravencoin, among others. others.  

However, due to the Ethereum Merge, which put an end to mining on the network, the company saw sales cuts of up to 50% by the end of 2022.  

That is why the company has set its sights on AI. NVIDIA’s own CTO sees the potential of AI for society. In his own words, he suggests that “cryptocurrencies offer nothing to society, AIs do”, in relation to the high consumption of GPUs that both technologies require.