Nvidia (NVDA) stock maintained its upward momentum for the third consecutive day following its earnings report, closing Monday with an additional 7% increase and finishing around $1,140. This rise builds on last week's impressive 15.1% gain. This boost brings the AI giant's market cap to over $2.8 trillion, inching closer to the $3 trillion mark.
Patrick Seitz, an author at Investors Business Daily, reported on the reason behind Monday's stock movement. He explained, “The stock responded to a weekend report that Elon Musk's xAI venture is purchasing Nvidia AI chips for a powerful new supercomputer.” According to a report from The Information on Saturday, Musk's AI startup, xAI, is collaborating with Oracle (ORCL) to build a new data center.
An investor presentation revealed that xAI will need up to 100,000 specialized semiconductors to develop and operate the next version of its AI chatbot, Grok. The supercomputer will utilize Nvidia's H100 GPUs, with Musk aiming to have it operational by fall 2025. He described the project as a "gigafactory of compute." With this significant deal secured, investor sentiment soared, leading to a surge in buying activity that drove the stock to record highs.
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