Nvidia shares skyrocketed to new record high — thanks to Elon Musk

On Tuesday, shares of Nvidia (NVDA) traded above $1,100 for the first time ever, helping the stock surpass its previous closing record. The stock ended the day above $1,140.

The breakthrough moment came after Elon Musk’s artificial intelligence startup xAI announced on Sunday that it had raised $6 billion in a Series B funding round, sending Nvidia’s shares up as much as 8% the next trading day.

A surge in artificial intelligence investment continues to increase optimism about Nvidia’s growth rate as the chipmaker continues its record-breaking stock rally. Last week, Nvidia announced first-quarter results that more than impressed Wall Street, with adjusted earnings up 461% year-over-year while revenues rose 262%.

The information suggests that Musk plans to use Nvidia chips to create a new “supercomputer” that will be used to power an xAI chatbot called Grok.

“xAI will continue on this steep path of progress in the coming months, with many exciting technology and product updates to be announced soon,” reads Sunday’s blog post.

In addition to the stellar earnings, Nvidia also announced a 10-to-1 stock split and an increase in its cash dividend – a move that has been echoed by other tech giants in recent quarters.

In an exclusive interview with Yahoo Finance following the company’s earnings report, Nvidia CEO Jensen Huang downplayed concerns about a future demand slowdown after the executive said the company’s first-quarter data center expansion continued to be driven by “strong and growing demand for generative training in field of artificial intelligence. “

“People want to deploy these data centers now,” Huang said. “They want to get our (GPUs) up and running right away and start making money and saving money. That’s why the demand is so high.”

The company reported record quarterly data center revenue of $22.6 billion, up 427% from the year-ago period. In total, Data Center revenues accounted for 86% of the company’s total revenues in the quarter.

Aleksandra Channel is a senior reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at [email protected].

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