Could Nvidia Be Worth More Than Apple?

By Douglas A. McIntyre Published Feb 25, 7:43AM EST

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Could Nvidia Be Worth More Than Apple? — © Antonio Bordunovi / iStock Editorial via Getty Images

Almost no one saw the astronomical rise of AI chip company Nvidia (NASDAQ: NVDA) coming. Its market cap, at nearly $2 trillion, has jumped ahead of tech behemoths Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOG). Its revenue is rising at a triple-digit pace, and the AI revolution means that pace could continue for several more quarters, if not longer. Only two public corporations have a higher market cap than Nvidia. One is Microsoft (NASDAQ: MSFT) at $3.1 trillion. The other is Apple (NASDAQ: AAPL) at $2.8 trillion. Among the differences between Apple and Nvidia is that one benefits from older technology, and one benefits from technology that is considered the wave of tech and, in some ways, the world’s future. Even Warren Buffett sold Apple shares.

Apple’s success is almost completely hardware-driven, and its primary product, the iPhone, is over a decade old. Additionally, Apple is no longer growing. In its most recent quarter, revenue rose a very modest 2% to $119.6 billion. Of this, all but $23.1 billion came from hardware. Apple has an installed base of 2.2 billion active devices. However, the flagship iPhone was introduced in 2007. Investors worry that each new smartphone generation is not different enough from the previous version to keep iPhone sales rising rapidly.

Apple’s shares are higher by a modest 24% in the last year, while the S&P is up 19%.

Nvidia’s shares are up 238% in the last year. Part of this steep climb came after it announced spectacular earnings. Its revenue in the most recent quarter was much smaller than Apple’s, at $22.1 billion. However, it grew by 265%. The company forecasts that the current quarter will likely post astonishing growth again. CEO Jensen Huang commented, “Accelerated computing and generative AI have hit the tipping point. Demand is surging worldwide across companies, industries and nations.”

AI, based on many tech experts, could be the most important technological improvement since the invention of the internet or the first widely available PC. If it changes how people work and their daily lives as much as expected, the AI revolution could be even more critical.

Can Nvidia’s stock rise by 40% to match Apple’s? If the AI revolution is close to most expectations, and its revenue continues to grow at trip digits, it is possible.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.