Nvidia, a chipmaker that benefits from the growing popularity of artificial intelligence, has joined the select group of companies with a market valuation of $1 trillion.

Nvidia Corp. joins other $1 trillion companies including Alphabet, Apple, and Microsoft. In today's trade, its shares increased by five percent, surpassing $408 per share. The stock has increased by almost 33 percent annually since its initial public offering in 1999, compared to an average annual rise of seven percent for the benchmark S&P 500 index over the same period.

The manufacturer of graphics chips for video games and artificial intelligence said last week that it had surpassed Wall Street expectations with its quarterly earnings of almost $2 billion and revenue of $7 billion.

After chipmaker Nvidia Corp. predicted strong revenue growth and said it would increase production of its AI chips to meet growing demand, stocks related to artificial intelligence gained in extended sessions, increasing the market value of these companies by approximately $ 300 billion.

On the strength of Nvidia's outstanding report, shares of other AI-related companies rose, boosting the market worth of these companies by an extra $100 billion after the bell.

Rival Advanced Micro Devices Inc. saw a 10 percent growth. Both Alphabet Inc., the parent firm of Google, and Microsoft Corp. saw increases of about two percent. These businesses are pushing hard to include generative AI in their web search engines.

This year, interest in AI increased after the company OpenAI introduced ChatGPT and drew over a million users in a week. Using historical data, generative AI may create new content, such as fully formed text, pictures, and software code.

Prior to this week's quarterly reports, the chipmaker's stock had already increased by 109 percent in 2023, making it the top performer in the S&P 500 for the year as a result of the optimism surrounding AI.

Nvidia, situated in Santa Clara, California, may provide an early glimpse of how AI may change the computer industry, according to industry analysts. The 1993 founding of the business saw a primary concentration on 3D graphics and video games. Jensen Huang, a co-founder, is still the company's president and CEO.

The chips from Nvidia are used in a variety of applications, including robots, the metaverse, medical imaging, and video analytics.