Nvidia stock (NASDAQ: NVDA) surged over 3% in pre-market trading on Wednesday, pushing the GPU maker closer to an unprecedented $5 trillion market valuation, a milestone no chip company has ever approached.
The latest rally comes in the backdrop of some major announcements by CEO Jensen Huang, who announced $500 billion investments in AI chip bookings.
Huang also unveiled plans to build seven new supercomputers for the US Department of Energy, powered by over 100,000 Blackwell GPUs.
Nvidia stock: AI spending wave keeps momentum intact
Big Tech is gearing up for an enormous AI build-out next year. Microsoft, Amazon, Google, and Meta together are expected to pour between $300 billion and $360 billion into AI infrastructure in 2025, a staggering jump of about 58% from 2024.
Amazon alone could spend around $100 billion, followed by Microsoft at about $80 billion, and Alphabet close to $75 billion.
Most of this money is going into new AI-focused data centers, and the hyperscalers are locking in the hardware they need before anyone else can, making it a perfect opportunity for investors to make their money work for themselves.
They are grabbing priority access to Nvidia GPUs, which is squeezing supply for the rest of the semiconductor market.
And it’s not just the tech giants anymore.
Enterprise AI demand is spreading fast. Hewlett Packard Enterprise, for example, is teaming up with Nvidia to deliver ready-to-deploy AI systems for government agencies and highly regulated industries.
Moves like that show the AI build-out is expanding well beyond the public cloud to a much larger universe of buyers.
Nvidia still can’t make chips fast enough to meet demand. Its current H100 GPUs and the next-gen Blackwell line are basically sold out.
Morgan Stanley analysts say the Blackwell chips are fully booked for the next 12 months, and anyone trying to place a fresh order now could be waiting until late 2026.
There’s a reason everyone is scrambling to get them: the new B100 and B200 chips deliver 2x to nearly 4x the performance of the H100 for both training and inference.
That kind of jump makes them a no-brainer upgrade for companies building or scaling AI models, and it puts Nvidia in pole position to win the next big wave of AI spending.
Investors price in a historic valuation
The $5 trillion valuation milestone dwarfs the combined market capitalization of Broadcom, TSMC, AMD, ASML, Micron, Lam Research, Qualcomm, Intel, and Arm, underscoring Nvidia’s singular dominance in AI chip infrastructure.
For context, Nvidia’s market cap now exceeds the nominal GDP of every country except the United States and China, and roughly equals Germany’s projected 2025 GDP.
Apple and Microsoft previously reached the $4 trillion mark, but no company has ever closed above $5 trillion, making Nvidia’s ascent a historic moment in corporate valuation history.
Nvidia has gotten so big that it now makes up more than 7% of the entire S&P 500, making it the single largest stock in the index. Because of that, its moves have an outsized impact on how the benchmark performs overall.
And it’s not just Nvidia. The so-called “Magnificent Seven”: Nvidia, Microsoft, Apple, Amazon, Alphabet, Meta, and Tesla, now represent 37.4% of the S&P 500’s total weight.
That’s the highest concentration the index has ever seen, underscoring just how dominant a handful of tech giants have become in driving US equity markets.
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