Move over, Microsoft and Apple. The stock market has a new king.

On Tuesday, Nvidia leapfrogged two of tech’s most storied names to become the world’s most valuable public company, according to data from S&P Global. Its ascent has been powered by the boom in generative artificial intelligence and surging demand for the company’s chips — known as graphics processing units, or GPUs — which have made it possible to create AI systems.

Nvidia’s rise is among the fastest in market history. Just two years ago, the company’s market valuation was over $400 million. Now, in the span of a year, it has gone from $1 trillion to more than $3 trillion.

On Tuesday, Nvidia rose 3.6%, lifting its market value to $3.34 trillion. Microsoft and Apple both fell, ending the day trailing the Silicon Valley chipmaker.

Years before other big chip companies, Nvidia CEO Jensen Huang bet that GPUs would be essential to building AI, and he tailored his company to accommodate what he believed would be tech’s next big boom.

His big bet is paying off. By some measurements, Nvidia controls more than 80% of the market for the chips used in AI systems. Nvidia’s biggest customers regularly jockey for orders for chips to run computers in their giant data centers, and are building their own AI chips so they are not so dependent on one supplier.

“No one else fully saw or appreciated this,” said Daniel Newman, CEO of the Futurum Group, a tech research firm. “They saw the trend, built for the trend and enabled the market. They can effectively charge whatever they want.”

Nvidia’s ascent has made Huang a celebrity in the tech world. After a computer conference in Taiwan this month, he was surrounded by attendees who wanted his autograph, including a woman who asked him to sign her chest.

The speed at which Nvidia’s value has grown has been startling. Apple crossed $1 trillion in August 2018 and became the first $3 trillion company last June. Microsoft also took nearly five years to climb from $1 trillion to $3 trillion.

But Nvidia’s investors are betting more on its potential than on its current profits. Microsoft and Apple generate more than $85 billion in annual profits, while Nvidia generates $42.6 billion.

“The numbers have gotten so big so quickly that people worry: Is this sustainable?” said Stacy Rasgon, an analyst with Bernstein Research. “If the return on AI turns out to not be there, then the whole thing comes crumbling down.”

— New York Times

Retail spending flat in May, down in April

Consumers barely increased spending in May from April as still high prices on groceries and other necessities and high interest rates curbed spending.

Retail sales rose 0.1% in May, below the pace that economists projected, the Commerce Department said Tuesday. And April sales were revised downward — a 0.2% decline, from unchanged.

Retail sales in May, in part, were depressed by falling gas prices. Excluding sales from gasoline, sales were up 0.3%. The national average price for a gallon of unleaded gasoline was $3.45 as of Monday; a month ago, it was $3.59, AAA said.

Government retail data isn’t adjusted for inflation, which was unchanged from April to May, according to the latest government report. High inflation helps to inflate retail sales figures.

Stellantis recalls 1.2M vehicles over camera

Stellantis is recalling nearly 1.2 million vehicles in the U.S. and Canada to fix a software glitch that can disable the rearview cameras.

The recall covers Jeep Compass, Grand Cherokee, Wagoneer and Grand Wagoneer SUVs from the 2022 and 2023 model years. Also included are Ram ProMaster vans from 2022 and 2023, as well as the Ram 3500 chassis cabs and Ram 1500 and 2500 pickups from 2022. Also covered are 2021 through 2023 Chrysler Pacifica minivans and Jeep Grand Cherokee L SUVs, and 2021 and 2022 Dodge Durango SUVs.

A company investigation found that the vehicles have radio software that can inadvertently shut down the cameras.

— From news services