We’ve seen something of a dramatic value drop in the tech world recently. As of August 2023, some of the biggest technology companies in the U.S. have seen significant falls in their market value. The investors and traders of the world aren’t overly concerned despite everything as this month is always predicted to be weaker than the rest, but what stands out more is the major company that managed to buck the trend: Nvidia.
The State of the Tech Market
At a glance, the numbers don’t look great. Apple, for instance, dropped 10% in value for August as iPhone and iPad sales slowed across America. Tesla’s market value took a hit to the tune of 13% thanks in part to planned price drops on their various car models, and social media giants Meta have seen a loss of around the same amount.
This is despite a positive outlook on the S&P 500 futures chart, which has shown around a 14% increase in total value from around the same time last year, with the three companies above contributing a major part to the index.
Up there with them now, however, is Nvidia who has gone from strength to strength this year. The company is known for the production of PC graphics cards but is also a major producer of semiconductors and creates the software behind many of the world’s supercomputers as well. The company has more than doubled its revenue since 2020, up to an incredible $27 million per year, and has recently joined a prestigious club of companies such as Apple and Meta with a trillion-dollar market cap.
What Has Made Nvidia Different?
As with most things in major businesses, you can’t easily point to one thing to explain everything, although in this case, experts are confident that the field of AI is a leading factor in Nvidia’s success. The development of artificial intelligence is at an all-time peak and as any computer engineer will tell you, AI software is some of the most demanding in the world.
It’s not uncommon for companies to have thousands of high-end machines all running together just to generate one result with operating costs that can easily run into the millions.
That’s where Nvidia comes in. Far from the personal-use graphics cards that gamers flock to buy even in the highest-end Alienware machines, Nvidia’s industrial chips are on a different scale and they can produce them in vast numbers. As it stands, Nvidia is the go-to company for AI developers and researchers when getting set up, which in turn is attracting the attention of high-profile investors.
Can It Continue?
You might think that once all the companies who want to make an AI have their equipment, then there’s nothing more to sell them. However, we are at the very beginning of AI as a concept and every new generation, which can come easily inside of a year these days, is far more demanding than the last. It wouldn’t be an overstatement to say that the speed of AI development is directly linked to how fast Nvidia and other producers can develop more powerful tech.
So the short answer is, there’s no sign that Nvidia is going to stop expanding any time soon!