Market capitalization of top 10 AI companies increases by 54 trillion following ChatGPT launch
The launch of OpenAI’s revolutionary AI platform, ChatGPT, during the transition from November to December 2022, had a profound impact on various companies and the stock market itself. The surge of AI technology was vividly demonstrated through the market capitalization growth of the top 10 companies heavily involved in the sector. According to research by Finbold, these companies saw a staggering increase of $5.4 trillion from December 3, 2022, to June 5, 2024.
Among the notable beneficiaries of the AI boom was the renowned chipmaker Nvidia (NASDAQ: NVDA), whose market capitalization skyrocketed from $420 billion to an impressive $2.8 trillion. While Nvidia’s success was remarkable, it was not the sole company to experience substantial growth due to the AI revolution. Microsoft (NASDAQ: MSFT) strategically aligned itself with OpenAI early on in 2019, which significantly boosted its AI capabilities and led to remarkable market cap expansion.
A noteworthy trend observed in the growth of AI companies was the remarkable concentration of wealth within the market. Nvidia alone contributed $2.4 trillion to the total growth of the top 10 companies, accounting for about 45% of the overall increase. The remaining 55% of growth was primarily dominated by Microsoft, Alphabet (NASDAQ: GOOGL), and Meta Platforms (NASDAQ: META).
As of June 5, 2024, the combined market capitalization of the top 3 companies – Microsoft, Nvidia, and Alphabet – stood at $8.1 trillion, representing 78.64% of the total market cap of $10.3 trillion. Including Meta and Tesla (NASDAQ: TSLA) raised this figure to 95.77%, with a collective market cap of $9.8 trillion. Conversely, the bottom 3 companies accounted for a mere 0.81% at $83.32 billion.
While AI has become a buzzword and a popular strategy for companies to attract investors, Finbold’s analysis of the top 10 AI companies revealed that it is not a guaranteed path to success. Despite the achievements of companies like Nvidia, Meta, and Palantir, some stocks have faced declines despite their involvement in cutting-edge technology.
For instance, Tesla Motors, led by Elon Musk, saw a $48 billion drop in market capitalization post the release of ChatGPT, despite its advancements in electric vehicles and AI-driven technology. Mobileye, a subsidiary of Intel (NASDAQ: INTC) focusing on AI-driven driver assistance, also experienced a decline in stock market value since late 2022. Adobe (NASDAQ: ADBE) witnessed a significant $70 billion decrease in market capitalization in 2024, despite the AI-driven surges seen throughout the year.
