Nvidia Stock Rises After AI Darling Reveals Next-Gen Chip

UPDATE—June 3, 2024: This article has been updated with the latest share price information and a photo of CEO Jensen Huang.

Shares in Nvidia (NVDA), which sits on the precipice of joining the exclusive $3 trillion market capitalization club, rose in early trading Monday after Chief Executive Officer Jensen Huang said that the company’s next-generation artificial intelligence chip—branded as Rubin—would be released in 2026.

While Huang kept details about the new family of chips limited while at a trade show Sunday at National Taiwan University in Taipei, he said that they will include new graphics processing units (GPUs) and central processing units (CPUs) as well as networking chips. In addition, Huang said the new CPU will be named Versa and that the next-gen GPUs used to power AI applications will bundle high-bandwidth memory.

Plans to Release New Family of Chips Each Year

The Nvidia chief also said that the company has plans to unveil a new family of chips each year, ramping up from its current release schedule of every two years. While chipmakers, such as Advanced Micro Devices (AMD) and Intel (INTC) have made inroads trying to capture a slice of the AI pie, Nvidia still controls roughly 80% of the AI chip market.

In the meantime, Nvidia plans to release its highly anticipated Blackwell family of chips this year, with Huang telling investors on the company’s first-quarter earnings call last month that the Blackwell platform is in full production, noting that the company plans to start shipments in the second quarter before ramping up deliveries in the third quarter.

Nvidia on Verge of Exclusive $3T Market Cap Club

Separately, Nvidia’s 27% rally in May, fueled by another blowout quarterly earnings report, places it on the precipice of joining Windows maker Microsoft (MSFT) in the exclusive $3 trillion market capitalization club.

With Nvidia’s market cap sitting at $2.7 trillion through Friday’s close, only Microsoft and iPhone maker Apple (AAPL), with respective market values of $3.09 trillion $2.95 trillion, were larger as of the end of last week.

Monitor This Key Chart Level

Nvidia shares have remained in a strong uptrend since the 50-day moving average (MA) crossed above the 200-day MA in January last year to form a bullish golden cross pattern. Following the stock’s earning’s gap to a new all-time high (ATH) on May 23, the price has continued its upward momentum, though saw some profit taking late last week.

If the pullback carries through to this week, investors should keep a close eye on the $970 level, where the price is likely to encounter a confluence of support around its prior record close at $974 and earnings gap breakout point.

Nvidia shares were up 3.6% at $1,135.82 at around 9:50 a.m. ET, after losing ground in each of the previous two sessions.

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As of the date this article was written, the author does not own any of the above securities.