Nvidia Hits $5 Trillion Market Cap Amid AI Surge

Nvidia Corporation has become the first company to reach a market valuation of $5 trillion, driven by dominant demand for its graphics processing units used in AI training and inference. In its first quarter of fiscal 2027, the company reported revenue of $81.6 billion, marking an 85% year-over-year increase. The data center division was the primary driver, generating $75.2 billion of that total. To sustain this momentum, Nvidia is launching the Vera custom Arm-based CPU and the Rubin system, with plans to shift focus away from the gaming market to prioritize data center products.

Management projects that AI hyperscaler capital expenditures will rise from $650 billion in 2026 to $1 trillion in 2027, with annual worldwide spending potentially reaching $3 trillion to $4 trillion by 2030. Alphabet Inc. corroborated this trend, signaling a "significant expansion" in its 2027 capital expenditures. This infrastructure boom has also benefited other firms; SanDisk reported a 251% revenue increase due to NAND memory demand for AI data centers.

During the Computex trade show in Taipei, CEO Jensen Huang endorsed Marvell Technology as the "next trillion-dollar company," following a $2 billion Nvidia investment to integrate Marvell into the NVLink Fusion ecosystem. However, TS Lombard analysts warned that Nvidia's valuation could mirror Cisco Systems during the dot-com era, questioning if current AI investments are sustainable despite accelerating compute demand.