Nvidia Corp., the renowned chip company, has experienced a significant rise in its value and market standing. In fact, it has soared up the list of the most valuable U.S. companies, securing the fifth position with a staggering market capitalization of $1.2 trillion. This represents a significant climb of eight spots since the end of last year.
However, while Nvidia's progress is remarkable, other chip companies have seen even more substantial advancements. A notable example is Broadcom Inc., which has ascended an impressive 16 spots throughout 2023. Just recently, Broadcom made its debut in the top 10, surpassing Visa Inc. at Friday's closing to occupy the coveted No. 10 spot. With a valuation of $527.7 billion, Broadcom has cemented its place among the industry leaders.
Behind Broadcom's remarkable ascent lies a strategic acquisition. The company acquired VMware in late November, resulting in an increase of approximately $50 billion in market capitalization. The artificial-intelligence frenzy that has engulfed the tech world this year has also played a significant role in Broadcom's success. Its stock has witnessed a doubling in value thus far in 2023.
Industry experts anticipate a surge in networking silicon orders for AI clusters during the second half of 2024. This trend is expected to continue in 2025 as significant capital-expenditure investments are made in AI for high-speed Ethernet connections. Mizuho desk-based analyst Jordan Klein predicts that Broadcom will emerge as the primary beneficiary of this investment cycle due to its close ties with various networking original equipment manufacturers (OEMs).
Another chip company that has made remarkable strides this year is Advanced Micro Devices Inc. (AMD), which has climbed an impressive 48 spots to secure its place as the 30th largest company by market capitalization. As of Friday's closing, AMD was valued at $223.9 billion.
BofA Securities analyst Vivek Arya views AMD as well-positioned to expand its market share in the highly lucrative $100 billion-plus accelerator market. Additionally, the company continues to make significant strides in server central processing units (CPUs), posing a formidable challenge to the incumbent player, Intel.
In conclusion, Nvidia Corp., Broadcom Inc., and Advanced Micro Devices Inc. have witnessed remarkable growth and success in the chip industry this year. These companies are capitalizing on the artificial-intelligence frenzy and positioning themselves as key players in the ongoing technological revolution.