So Nvidia just became the first company to hit $4 trillion in market cap back in July, and honestly? They’re not done flexing.
While everyone’s been arguing about whether AI stocks are overvalued, Nvidia quietly doubled from its April lows and is now sitting pretty at $4.46 trillion. That’s not a typo – we’re talking about a company worth more than most countries’ entire GDP.
Here’s the thing that makes Nvidia different from your typical “growth story gone wild” stock: they’re actually making ridiculous amounts of money. We’re talking $86.6 billion in trailing twelve-month net income. A few years ago, they were making a few billion. Now they’re printing money faster than the Federal Reserve.
The AI Gold Rush Has a Clear Winner
Remember when Nvidia was just “that gaming graphics card company”? Those days are long gone. They figured out that the same chips that make your video games look pretty are exactly what you need to train AI models. Talk about being in the right place at the right time.
Their biggest customers read like a who’s who of tech royalty: Amazon Web Services, Microsoft, Google, OpenAI, Meta, Oracle. Basically, if you’re building the future of AI, you’re buying from Nvidia. And these companies aren’t slowing down their spending – they’re accelerating it.
The math is actually pretty straightforward here. As long as Big Tech keeps throwing billions at AI infrastructure, Nvidia keeps winning. It’s that simple.
Microsoft: The Steady Eddie of Tech Giants
Speaking of winners, Microsoft deserves some love too. They hit $4 trillion in August (though they’ve slipped back to $3.82 trillion – still not exactly pocket change).
What makes Microsoft interesting is how they’ve transformed from “that Windows company” into basically the Swiss Army knife of tech. They’ve got Azure cloud services, they’re integrating AI into everything from Excel to LinkedIn, they own Xbox and just dropped $69 billion on Activision-Blizzard. Oh, and they’re still making bank on Office subscriptions.
For Microsoft to hit $5 trillion, they only need to go up about 32%. Given their diversified revenue streams and reasonable valuation, that’s not exactly a moonshot.
The Reality Check
Look, both stocks are expensive by traditional metrics. But here’s the thing about “expensive” stocks in 2025 – if they keep delivering earnings growth like this, today’s prices might look like bargains in a few years.
Nvidia’s trading at about 28.7 times forward earnings based on 2027 estimates. For a company growing this fast, that’s actually reasonable. Microsoft’s valuation is even more conservative.
The real question isn’t whether these stocks are expensive – it’s whether they can keep executing. Both companies have fortress balance sheets, massive cash piles, and are positioned to benefit from the biggest tech shift since the internet.
Sometimes the best investments are hiding in plain sight. Even when everyone’s talking about them.