Nvidia Stock Surge Following AI Investment Announcements

Nvidia’s stock (NVDA) experienced a rise of up to 4.3% on Thursday, leading gains in the semiconductor sector, after major tech companies Meta and Microsoft affirmed their commitment to significant investments in AI technology.

Other AI chip manufacturers, such as Advanced Micro Devices (AMD) and Broadcom (AVGO), also saw gains, with shares increasing by 1.1% and 4.5%, respectively. Micron (MU), a supplier to Nvidia that produces advanced memory chips for its GPUs, rose by 2.4%.

This uptick in stock prices came on the heels of earnings reports from Microsoft and Meta, which not only confirmed their AI investment strategies but also, in Meta’s case, increased spending forecasts for AI infrastructure in light of growing data center needs.

Microsoft reiterated its ambitious $80 billion plan to enhance its AI data centers, committing more than half of that budget to initiatives in the U.S. Meanwhile, Meta adjusted its 2025 capital expenditure forecast upwards, now estimating spending between $64 billion and $72 billion.

Meta’s CFO Susan Li noted, “This updated outlook reflects additional data center investments to support our AI efforts,” indicating that most capital expenditures will still focus on their core business. Similarly, Microsoft’s CFO Amy Hood emphasized the company’s ongoing commitment to meet the rising demand for its services.

Concerns had emerged among investors about a potential slowdown in Microsoft’s AI investments, especially after reports suggested the company had canceled some data center projects. Nonetheless, both Microsoft and Meta remain crucial clients for Nvidia, contributing an estimated $20 billion and $9 billion, respectively, to Nvidia’s revenue in 2024.

The drive toward AI investment across major tech firms continues unabated, with industry leaders like Google, Amazon, and Microsoft expected to collectively spend over $330 billion on these initiatives this year.