Nvidia briefly became the world’s most valuable company on Wednesday after its stock jumped over 4% in price to a new high of $154.10, pushing its market value to $3.76 trillion. Reuters said the chipmaker overtook Microsoft, which stood at $3.65 trillion after a smaller gain.
The rise follows a note from Loop Capital, which raised its price target for Nvidia to $250 from $175. The firm kept its “buy” rating and said demand for generative AI could grow faster than expected.
“We are entering the next ‘Golden Wave’ of Gen AI adoption and Nvidia is at the front-end of another material leg of stronger than anticipated demand,” said Loop Capital analyst Ananda Baruah.
The renewed interest in AI has sent investors back into tech stocks, especially companies involved in chips and data infrastructure. Nvidia, which designs high-performance GPUs used in AI models, has been a key figure in that trend.
Even with the stock’s strong performance, its valuation doesn’t appear overly stretched. Nvidia trades at about 30 times projected earnings for the next year, below its five-year average of 40 times. This suggests analysts have been raising their forecasts as the company keeps delivering bigger profits.
Nvidia, Microsoft, and Apple have all rotated in and out of the top spot for market value over the past year. Microsoft had recently pulled ahead, but Nvidia regained the lead this week. Apple’s shares rose 0.4% on Wednesday, bringing its valuation to about $3 trillion.
Nvidia’s stock has climbed more than 60% in value since hitting a low in early April. That drop came during a broader sell-off triggered by tariff announcements from Donald Trump. Since then, markets have steadied, with hoping for trade deals that could reduce some of the pressure on the company.
The broader tech sector has also been moving to higher valuations. The S&P 500’s technology index was up 0.9% on Wednesday, reaching a new record. It has gained nearly 6% so far in 2025.
Tesla’s AI push goes beyond self-driving cars
Tesla is best known for electric vehicles, but the company is also working to build up its AI capabilities and robotaxi project, plus lesser-known work in robotics.
While many are focused on Tesla’s push to launch a self-driving ride-hailing service, CEO Elon Musk has also been talking about a broader AI future. As The Motley Fool highlighted, one example is Optimus, a humanoid robot the company is developing for factory and, potentially, domestic use.
Nvidia CEO Jensen Huang recently highlighted the potential of this market, calling humanoid robotics a “multitrillion-dollar industry.” He mentioned Tesla’s Optimus project as one of the efforts that has caught his attention.
Tesla sees two main uses for Optimus. First, the robot could be trained with machine learning to help on the company’s own production lines. Over time, it could take over more tasks and operate without breaks, increasing factory output.
Secondly, Tesla could sell Optimus to other industries where labour is physically demanding. The robot could be adapted for more routine settings outside factories. Musk has said Optimus could eventually become more valuable than the company’s car business.
Other companies are also working in this space. Figure AI, a startup backed by Nvidia, is developing similar humanoid robots for use in factories. A demo video shows how its machines could work alongside people to boost output and reduce repetitive tasks.
What’s next for Tesla’s stock?
Tesla’s share price has jumped nearly 30%, driven in part by its robotaxi rollout. The company started testing the service in Texas this week, which has helped fuel investor optimism.
But some analysts say its stock may have already peaked due to the short-term excitement of the Optimus announcement. Tesla tends to move based on headlines, and the same pattern could apply to its robot and robotaxi projects.
While Optimus could become an important part of Tesla’s future, it’s still early. Key questions remain about how soon the robot can scale, how it will compare with other options, and whether the company can turn the project into a real business.
Investors watching Tesla’s AI plans may want to see more progress before making new bets.
