Nvidia’s (NVDA) share price rocketed yesterday on the back of particularly good results. We take a closer look at the enthusiasm currently surrounding the company nicknamed the “godmother of artificial intelligence”.
Nvidia (NVDA) shares explode on the rise
Yesterday, Nvidia (NVDA) shares exploded upwards, gaining 15% in the space of a few hours. It passed the $500 mark, before losing ground:
NVDA’s share price was already in a significant uptrend: since last May, it has risen by 70%. Over the year, it is up 133%. So how do you explain these consecutive rises?
Nvidia and artificial intelligence (AI)
This latest rise came after the company published its profit and loss accounts. These turned out to be much better than even the most optimistic of predictions. Nvidia announced revenues of 13.5 billion dollars, 2 billion more than expected. Nvidia is now worth more than 1,000 billion dollars, something that has never before happened to a computer chip manufacturer.
The reason for these substantial revenues is the current craze surrounding artificial intelligence. Nvidia is one of the first companies to benefit from the arrival of AI on the scene. It supplies the chips used by artificial intelligence systems. The company’s CEO, Jensen Huang, highlighted the revolution underway in a press release:
A new era of computing has begun. Companies around the world are transitioning to accelerated computing capabilities and generative artificial intelligence “
Nvidia breaks away from cryptocurrency mining
Notably absent from Nvidia’s report is any mention of cryptocurrency mining. This is no coincidence: although the giant has been producing specialist mining chips since 2021, they have faced a number of controversies. In 2022, the SEC condemned the manufacturer for failing to clarify the influence of its mining-related products on the rest of its video game-related services.
The company also seems to have turned its back on communications on this subject, following disappointing sales results for its mining-related products. Since Ethereum (ETH) switched to proof-of-stake, it is no longer possible to mine ETH using graphics cards… And that it is no longer profitable to mine Bitcoin (BTC). So the recent report confirms it: it is indeed AI that is occupying all the American giant’s thoughts at the moment.