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Reasons Behind NVIDIA's Surge Explained

Author Peter Yang delved into NVIDIA's history shedding light on the reasons behind the company's success, including its recent milestone of reaching a market value of $1 trillion.

As the stock market closed on Tuesday, the world was taken aback by an astounding revelation regarding NVIDIA – the company achieved an extraordinary milestone by becoming the very first chipmaker to attain a market value of $1 trillion.

According to author Peter Yang, NVIDIA's value now surpasses that of both Facebook and Tesla. To shed light on the surge of Nvidia, Yang took to Twitter and shared a thread that provides a chronological account of the company's journey.

The author explained that NVIDIA made a groundbreaking invention in 1999 by introducing the graphics processing unit (GPU). The company's GeForce series proved to be an ideal solution for PC and console games, catering to the demanding needs of high-quality graphics.

However, according to Yang, NVIDIA had a much broader impact on the industry beyond just GPUs. He mentioned that in 2007, NVIDIA introduced the CUDA computing platform, which aimed to simplify programming GPUs. This innovation made it significantly easier for players in the field of AI to adopt NVIDIA's chips compared to their competitors.

Yang also highlighted another important aspect of GPUs – their suitability for handling the data processing and model training requirements of generative AI. He quoted an analyst explaining that training AI models requires chips with large memory, and NVIDIA is the only manufacturer that produces such chips.

Apart from the current success, Yang also pointed out that a significant market opportunity for the company lies ahead. He quoted NVIDIA CEO Jensen Huang, who emphasized the enormity of the data center market, which currently amounts to $1 trillion and has traditionally relied heavily on CPUs. Huang predicts that within the next 5-10 years, a substantial portion of that market will undergo a significant transformation, mainly driven by the rise of generative AI.

Yang concluded that NVIDIA is a company that sees opportunities and uses them in its advantage. In the author's words, "In a gold rush, sell the shovels. NVIDIA's GPUs could be the most lucrative shovels ever."

You can find Peter Yang's Twitter thread here. Also, don't forget to join our 80 Level Talent platform and our Telegram channel, follow us on Instagram and Twitter, where we share breakdowns, the latest news, awesome artworks, and more.

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