On Wednesday, Nvidia Corporation NVDA surpassed Apple Inc. AAPL in terms of market capitalization, becoming the second most valuable company in the world. This development fulfills a prediction made three months ago by analyst Ming-Chi Kuo.
What Happened: In March, Kuo, an analyst at TF Securities, had forecasted that Nvidia’s market cap would likely surpass Apple’s. He based this prediction on the declining market consensus for 2024 iPhone shipments and the potential failure of the Tim Cook-led tech giant to launch impressive generative AI services.
On Wednesday, Kuo re-shared his earlier prediction, stating, “The prediction from three months ago has come true. This is not just a comparison of Nvidia and Apple's stock prices but a contrast between the strong growth trend of AI and the innovation challenges faced by consumer electronics.”
At the time of writing, Nvidia’s market cap was at $3.011 trillion, while Apple’s was at $3.0303 trillion.
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Why It Matters: In April, it was reported that Apple's iPhone shipments decreased by almost 10% in the first quarter. Conversely, the global smartphone market saw a 7.8% increase in shipments, reaching 289.4 million units.
Samsung Electronics Co. regained the top spot, and budget-focused brand Transsion experienced an 85% surge in shipments. Apple's challenges in China, the world’s largest smartphone market, have affected its overall performance.
Apple is slated to unveil its upcoming software iOS 18 at WWDC 2024. It is expected to be “one of the biggest iOS updates — if not the biggest — in the company’s history.” The update is anticipated to revamp Siri and incorporate generative AI, with most AI features functioning directly on the device for users with compatible hardware.
Moreover, the Cupertino, California-based tech giant has reportedly closed a deal with Sam Altman-led OpenAI to use ChatGPT on the iPhone.
Price Action: Nvidia shares rose by 5.16% on Wednesday, closing at a record high of $1,224.40. In after-hours trading, the stock saw an additional increase of 0.94% at the time of publication, according to Benzinga Pro. Meanwhile, Apple shares ended Wednesday’s session up 0.78%. In the after-hours session, Apple shares were down by 0.17% at $195.53.
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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
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