California-based tech company Nvidia (NVDA) reached a market cap of $1 trillion today (May 30) after a week of stock growth. Since its earnings call on May 24, the company’s stock has soared 38.8 percent, trading today at a high of $419.38 per share. Nvidia is the first chipmaker and ninth public company to pass the $1 trillion threshold, along with Apple, Microsoft and Amazon.
That’s good news for billionaire business magnate Jensen Huang. Huang has been Nvidia’s chief executive since he founded it in 1993, and the majority of his wealth is tied up in the company. According to Nvidia’s annual report, Huang owns 86.4 million shares or 3.51 percent of the company’s total stock. Prior to the company’s May 24 earnings announcement, Huang’s net worth was $28.1 billion, according to Forbes. Today, just a week later, he is worth $36.5 billion.
The Motley Fool called Nvidia a “monster winner” for 2023. During its most recent earnings announcement, Nvidia significantly outperformed analyst expectations. The company’s revenue for the three months ending April 30 hit $7.19 billion, up 10 percent from the analysts’ average estimate, according to Seeking Alpha. This could be a symptom of industry shifts towards generative AI and accelerated computing, a type of quicker processing, Huang said in the most recent earnings announcement. Nvidia specializes in both, and forecasts it will earn $11 billion during the same period next year—up 50 percent from analyst estimates.
Who is Jensen Huang?
Early in his career, Huang worked at LSI Logic and Advanced Micro Devices (AMD), both of which are semiconductor companies. At 30 years old, he founded Nvidia alongside electrical engineers Chris Malachowsky and Curtis Priem after the trio developed the framework for Nvidia at a San Jose, California Denny’s. Malachowsky still works at Nvidia as a senior technology executive, though Priem left the company in 2003.
Huang has been widely recognized as a leader in tech. The Harvard Business Review named Huang the No. 1 best-performing CEO in 2019, its final edition of the list. In 2021, he received the highest award given by the Semiconductor Industry Association, a semiconductor trade group, for his contributions to industry innovation.
The executive has also donated to his alma maters, Oregon State University and Stanford University. Last year, he gave $50 million to Oregon State to help build a research center. His $30 million gift to Stanford, where he completed a master’s degree in electrical engineering, built the Jen-Hsun Huang School of Engineering Center.
Nvidia’s growing role in AI
While Nvidia has been in machine learning and artificial intelligence for a decade, the company has benefitted from the increased focus on AI in recent months, sparked by the launch of ChatGPT.
Nvidia develops graphics processing units (GPUs), or chips that computers and phones use to render images, videos and other animations. Training and deploying large language models like ChatGPT require thousands of GPUs, so as the demand for chatbots and generative AI increases, so does the demand for Nvidia’s product. Today, the company is one of the top sellers of GPUs, along with Intel and AMD. OpenAI reportedly trained ChatGPT on 10,000 Nvidia GPUs, and while further details about ChatGPT’s GPU usage aren’t available, the chatbot could end up needing 30,000 GPUs as it readies for commercialization, market research company TrendForce reported.
Since March, the company has partnered with Google, Adobe, Microsoft and Dell Technologies to build and distribute generative AI technologies. It is also working on creating an AI-powered platform to help Medtronic—a Minneapolis, Minnesota-based healthcare company—build medical devices.