(Reuters) – Nvidia shares fell about 3.4 percent on Thursday, handing the title of the world’s most valuable company back to Microsoft.
Nvidia, whose market cap surpassed Microsoft on Tuesday, is on track to lose about $91 billion from its recent closing price of $3.34 trillion at the current level of $131.88.
Microsoft’s market capitalization also fell to $3.3 trillion, with its shares down 0.4% to $444.8 in afternoon trading.
Nvidia, Microsoft and Apple are in a three-way race to become the world’s most valuable company. Tim Cook’s iPhone maker has a market capitalization of $3.22 trillion, and its shares were down 2.2% to $210.10 in the afternoon.
Elon Musk said on his social media platform X on Wednesday that Dell and Supermicro are supplying server racks for Musk’s xAI startup’s supercomputer, which will be used to expand the capabilities of the company’s AI tool, Grok.
Dell Technologies and Supermicro Computer fell 1% and 0.7%, respectively.
Both companies build servers equipped with Nvidia chips, positioning them to take advantage of growing demand for the processors that power nearly all AI applications.
Musk said earlier this year that the Grok 2 model would require around 20,000 Nvidia H100 graphics processing units to train, while the Grok 3 model and beyond would require 100,000 Nvidia H100 chips.
“Microsoft is investing in AI and making money on it, but Nvidia is only making money on AI, and a lot of money on it, so you can’t talk about Nvidia without talking about AI,” said Jake Dollarhyde, CEO of Longbow Asset Management.
Nvidia shares have nearly tripled so far this year, leading the overall market rally. Supermicro shares have more than tripled in the same period, and Dell shares are up nearly 95%.
The Philadelphia SE Semiconductor Index has risen about 34% from its recent low in April and closed at an all-time high on Tuesday.
“Over the next few years, the strong will get even stronger in this tech market as AI technologies help large tech companies monetize their massive install bases across the enterprise (Microsoft, Oracle, Dell, Amazon, etc.) and consumer markets (Meta, Apple, Google),” said Dan Ives, analyst at Wedbush Securities.
(Reporting by Yuvraj Malik and Zaheer Kachwala in Bengaluru; Additional reporting by Medha Singh; Editing by Sreeraj Kaluvilla and Pooja Desai)