Nvidia Nears $4 Trillion Valuation Amid AI-Driven Stock Surge

Nvidia (NASDAQ:NVDA) came close to making history on Wednesday, briefly surpassing a $4 trillion market capitalization before pulling back slightly at market close. Shares rose 1.8% to finish at $162.88, just below the estimated $163.93 level needed to secure the milestone. Intraday, the stock reached a high of $164.42, driven by continued investor excitement around artificial intelligence.

The rally follows Nvidia’s strong Q1 earnings in May, which beat expectations despite challenges in China and concerns over AI model DeepSeek. CEO Jensen Huang credited the surge to four unexpected drivers of demand for Nvidia’s AI and data center chips.

First, Huang pointed to growing adoption of "reasoning AI"—models capable of more complex, contextual tasks. He noted exponential growth in AI, with recent advancements improving accuracy and reducing hallucination concerns. Second, Huang highlighted the easing of U.S. export restrictions on AI technologies, calling it a strategic advantage for American tech. “President Trump wants America to win,” he said. “The American stack needs to be global.”

Third, Nvidia is seeing accelerated enterprise AI adoption, particularly through agent-based systems and strong uptake of its RTX Pro Enterprise platform. Finally, Huang said global reshoring of manufacturing is driving demand for industrial AI, positioning AI infrastructure as the “fourth pillar” of modern production, alongside compute, storage, and networking.

Wedbush analyst Dan Ives called Nvidia’s performance a "historic moment" and said Microsoft (NASDAQ:MSFT) could soon join the $4 trillion club. He believes the tech bull market is just beginning, fueled by the accelerating AI revolution. “Nvidia and Microsoft are the poster children for the biggest tech trend in 25 years,” Ives said, adding that the $5 trillion milestone could be next.