NVIDIA Hits $4 Trillion Market-Cap Milestone: ETFs in Focus

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On July 9, 2025, NVIDIA NVDA became the first publicly traded company to reach a $4 trillion market capitalization, surpassing tech titans such as Microsoft MSFT and Apple AAPL. The company’s stock has surged 17.8% so far this year and climbed 20% over the past 12 months.

NVIDIA continues to benefit from the explosive growth of generative AI, sparked by the debut of OpenAI’s ChatGPT in 2022. Its hardware and software offerings—specifically modified graphics processing units (GPUs) and its CUDA software platform—position it uniquely to support both the training and deployment of AI systems. This has given NVIDIA a notable edge over competitors like AMD AMD and Intel INTC, which are still catching up.

Major technology companies including Amazon (AMZN), Alphabet (GOOG), Meta (META), Microsoft (MSFT), and Tesla (TSLA) are investing heavily in NVIDIA’s hardware products. These firms are building out massive AI data centers to power both internal models and customer-facing cloud-based AI services, fueling continued demand for NVIDIA’s chips.

NVIDIA’s stock price saw significant volatility earlier in the year. In January, the company lost $600 million in market capitalization after Chinese startup DeepSeek claimed it trained its R-1 model using less powerful chips. This raised concerns that NVIDIA’s high-end chips were becoming obsolete, especially as the AI industry appeared to shift its focus from training models to inferencing—running or using those models.

Despite those concerns, NVIDIA has proven its resilience. Its chips remain top-tier for training AI, and the inference phase of AI development has also demonstrated the need for advanced processors.

The rise of sovereign AI—national AI infrastructure that reduces reliance on foreign providers—has been another growth area for NVIDIA. Countries like Saudi Arabia and several others across Europe are expected to purchase hundreds of thousands of NVIDIA chips to support these localized AI efforts.

NVIDIA has also weathered geopolitical challenges, including U.S. government restrictions on chip sales to China. Although the company reported a $4.5 billion loss in the last quarter due to the ban and expects up to an $8 billion impact in the current period, investor confidence remains high and its stock continues to gain value.

NVIDIA is poised to launch its next-generation Blackwell Ultra chips, further extending its technological lead. With no material competitors emerging in the near term, the company appears well-positioned for continued dominance in the AI hardware space.

The forward P/E ratio of the stock is 38.4X, lower than 40.0X recorded by the Electronics Semiconductor industry. Price-sales ratio stands at 27.0X, slightly higher than 22.3X delivered by the industry. Its price-to-free-cash-flow ratio was 55.7X, almost in line with 55.4X recorded by the industry. The figures show that the stock is not overvalued if we measure the value against the Electronics Semiconductor industry. NVIDIA stock has an upbeat Growth Score of A, Momentum score of B.

Investors seeking to capitalize on the growth story could consider investing in ETFs with the largest allocation to the AI chipmaker. These include Strive U.S. Semiconductor ETF SHOC, VanEck Vectors Semiconductor ETF SMH, VanEck Fabless Semiconductor ETF SMHX, YieldMax Target 12 Semiconductor Option Income ETF SOXY and Columbia Semiconductor and Technology ETF SEMI.

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