On Friday, Nvidia Corp (NASDAQ:NVDA) shares gained 4.32%, pushing the chip designer’s valuation past $5 trillion as a fresh wave of AI-driven optimism lifted semiconductor stocks across the board.
AI Demand Fuels Nvidia's Historic Rally
Shares of Nvidia closed at $208.27 on Friday, marking their first record close since October. Year-to-date, Nvidia is up 10.28%, while over the past 12 months it has risen 95.68%, according to Benzinga Pro.
Nvidia's graphics processing units remain central to AI infrastructure, powering services at Microsoft Corp (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), Meta Platforms, Inc. (NASDAQ:META) and Alphabet Inc.'s (NASDAQ:GOOG) (NASDAQ:GOOGL) Google, as well as AI developers like OpenAI and Anthropic.
Despite its dominance, Nvidia faces mounting competition. Alphabet is developing in-house AI chips aimed at reducing reliance on Nvidia's hardware, potentially reshaping the competitive landscape.
Intel Earnings Spark Sector-Wide Surge
A stronger-than-expected earnings report from Intel helped reignite investor enthusiasm, with its stock soaring 23.64% on Friday.
Intel posted quarterly earnings of 29 cents per share, far exceeding analysts' expectations of just one cent.
Revenue for the quarter totaled $13.58 billion, topping the Street's estimate of $12.42 billion by about 9.3% and rising from $12.67 billion reported a year earlier.
The rally spilled over to rivals, as Advanced Micro Devices, Inc. (NASDAQ:AMD) jumped 13.91% and Qualcomm Inc. (NASDAQ:QCOM) gained 11.12%, signaling renewed confidence in the semiconductor sector's role in the AI boom.
Semiconductor-focused funds also moved higher, with the iShares Semiconductor ETF (NASDAQ:SOXX) gaining 4.67%, the VanEck Vectors Semiconductor ETF (NASDAQ:SMH) advancing 5.11% and the First Trust Nasdaq Semiconductor ETF (NASDAQ:FTXL).
Tech Stocks Rebound Despite Macro Pressures
The gains come after a period of volatility driven by rising oil prices and geopolitical tensions tied to the Iran conflict, which had weighed on large-cap tech stocks.
However, investors appear to be rotating back into the sector as demand for AI infrastructure shows little sign of slowing, boosting chipmakers and related exchange-traded funds.
Jim Cramer Says,‘Own It, Don't Trade It'
Taking to X, market commentator Jim Cramer weighed in on the rally, urging investors to stay the course.
"So many people bolted Nvidia… Own it don’t trade it right into its record price," he wrote.
Nvidia ranks in the 97th percentile for Quality on Benzinga Edge, reflecting solid performance across short, medium and long-term time frames.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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