Nvidia Worth More Than Alphabet, Amazon – 24/7 Wall St.

Technology

Published: February 23, 2024 6:45 am

After blockbuster earnings, Nvidia Corp.s (NASDAQ: NVDA) market cap is larger than that of Alphabet Inc. (NASDAQ: GOOGL), the owner of Google, and Amazon.com Inc. (NASDAQ: AMZN), the owner of cloud computing giant AWS. The question raised by this is whether artificial intelligence (AI) has a better economic future than search or cloud computing. (These 25 American industries are booming.)

Nvidias market cap is $1.96 trillion. Alphabets is $1.80 trillion, and Amazons is $1.81 trillion. In the past year, Nvidias shares are up 278% to $801. Amazons are up 82% to $174, while Alphabets are up 58% to $145. The Nasdaq is 45% higher than a year ago.

Most of Nvidias revenue comes from AI chips. Of its $22.1 billion in revenue in the most recent quarter, a small part ($2.9 billion) came from gaming. AI was virtually all of the balance. Overall revenue was up 265% year over year.

Amazons revenue rose 14% to $170 billion in the most recent quarter. AWSs cloud business had a revenue increase of 13% to $24.2 billion. Some investors think AWS is worth more than Amazons e-commerce business because cloud computing has been a major driver of tech revenue and stock valuations for several years. Based on Amazons stock price compared to Nvidias, AI may have replaced cloud computing as the core of tech growth across the industry.

In the most recent quarter, Alphabets revenue rose 13% to $86.3 billion. Its core ad business, Google and YouTube combined, had revenue of $76.3 billion, up 13%. Search has been a critical technology for over a decade, and Google has a market share of over 90% in many countries.

A look at the revenue growth of the three companies answers the question of comparison. For now, AI revenue is growing much faster than search or cloud computing revenue. Many analysts believe that may be true permanently. Based on this alone, the distance between Nvidias market cap and those of Amazon and Alphabet will continue to grow in Nvidias favor.

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Nvidia Worth More Than Alphabet, Amazon - 24/7 Wall St.