Nvidia shares pop 3% in premarket as tech giant nears historic $5 trillion valuation

Shares of Nvidia^[1] rose more than 3% in premarket on Wednesday, putting the tech giant on track to become the first company to cross the $5 trillion market value threshold.

The extraordinary milestone would reflect a remarkable rise for the company, which has evolved from a niche video game processor to an integral player in the artificial intelligence boom.

Shares of Nvidia were last seen up 3.1% in premarket. The stock price, which closed up 5% in the previous session, has climbed nearly 50% year-to-date.

The latest move higher comes shortly after CEO Jensen Huang said Nvidia expects^[2] $500 billion in AI chip orders and announced^[3] plans to build seven new supercomputers for the U.S. government.

Separately, Nvidia announced^[4] on Tuesday that it is taking a $1 billion stake in Nokia^[5], forming a strategic partnership with the networking company to develop next-generation 6G cellular technology.

U.S. stocks, fueled by the AI trade, climbed to record highs^[6] on Tuesday. The major averages were boosted by gains in tech, with Apple^[7] and Microsoft^[8] both reaching a market value of more than $4 trillion^[9] after their shares rose.

The dizzying rally for U.S. stocks comes despite lingering concerns over a bubble^[10], particularly as AI-driven spending has led to record deals and valuations.

Earlier in the month, the International Monetary Fund and Bank of England became the latest financial institutions to warn^[11] that global stock markets could be in trouble if investor appetite for AI turns sour.

Ark Invest CEO Cathie Wood on Tuesday flagged^[12] the near-term possibility of a “reality check” on AI valuations — but pushed back on fears of an AI bubble.

“If our expectations for AI … are correct, we are at the very beginning of a technology revolution,” Wood told CNBC on the sidelines of Saudi Arabia’s Future Investment Initiative (FII) in Riyadh.