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Nvidia Stock Hits Fresh Record High—Here’s Why

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6 months ago

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Nvidia Stock Hits Fresh Record High—Here’s Why

UPDATE—May 28, 2024: This article has been updated to reflect more recent share price information.

Key Takeaways

  • Nvidia shares reached a record high after Elon Musk reportedly said that his artificial intelligence company, xAI, would be building a supercomputer.
  • The chipmaker’s stock price was as high as $1,149.39 during intraday trading Tuesday.
  • Musk reportedly said that xAI would need 100,000 semiconductors to train and run the computer, which is supposed to be running by the fall of 2025, according to a report from The Information.
  • Other AI-related stocks like Advanced Micro Devices, ON Semiconductor, and Micron Technology were trading higher as well.

Nvidia (NVDA) shares reached a record high during intraday trading Tuesday after reports that Elon Musk told xAI investors that the artificial intelligence (AI) company would build a supercomputer.

The chipmaker’s shares were up 6.2% at $1,130.45 as of 2:30 p.m. ET Tuesday after trading as high as $1,149.39 during the session. The stock has more than doubled since the start of the year.

Musk reportedly said that xAI would need 100,000 semiconductors to train and run the supercomputer, which he said will be running by the fall of 2025, according to The Information.

The article said xAI may partner with Oracle (ORCL) to develop the supercomputer. Oracle shares were up about 0.9% at $123.97 as of 2:30 p.m. ET Tuesday.

xAI recently announced its Series B funding round raised $6 billion, which the company said will “be used to take xAI’s first products to market, build advanced infrastructure, and accelerate the research and development of future technologies.”

The additional funding and the reported new supercomputer could help xAI compete with Microsoft-backed (MSFT) OpenAI. Musk was an early investor in the ChatGPT maker but has since sued OpenAI, alleging that the company’s close relationship with Microsoft had caused it to abandon its founding principles. Following the lawsuit’s filing, Musk announced that xAI’s chatbot, Grok, would be open-source.

Other companies within Nvidia’s AI ecosystem and other chipmakers also were trading higher Tuesday, including Advanced Micro Devices (AMD), ON Semiconductor (ON), Arm (ARM), and Micron Technology (MU).

The news comes shortly after Nvidia’s blockbuster earnings, which sent shares surging.

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