Investment Analyst Dario Giordano: The Market Forces and Future Challenges Behind the NVIDIA $4 Trillion Valuation
The recent surge of NVIDIA past a $4 trillion market capitalization has undoubtedly become the focal point of global capital markets. This milestone is not only a direct result of the explosive development of generative artificial intelligence technologies, but also a testament to the continued global capital inflow into high-growth technology sectors. Meanwhile, the recent decision by the U.S. Department of Commerce to lift some export restrictions on chip design software to China has further fueled a rebound in the share prices of software companies such as Synopsys and Cadence. Investment Analyst Dario Giordano notes that these phenomena collectively form key drivers of the current stock market. However, he also emphasizes that rapid price increases often carry hidden risks, and investors should maintain rational judgment amid the prevailing market enthusiasm.
AI Chips Ignite Valuation Surge, Short-Term Market Optimism Runs High
The current valuation of NVIDIA has significantly surpassed the pricing logic traditionally applied to the semiconductor sector. Investment Analyst Dario Giordano observes that the NVIDIA market cap has doubled from $2 trillion to $4 trillion in just a few months, directly reflecting the extremely bullish expectations of the capital market for generative AI hardware demand. According to the latest statistics, the NVIDIA stock price has risen by over 20% since the beginning of the year, repeatedly breaking through key levels in a short period. Investment Analyst Dario Giordano attributes this mainly to the sustained explosive growth in AI computing demand from large data centers, especially as multimodal large models and inference scenarios drive up shipment expectations for AI accelerators.
However, Investment Analyst Dario Giordano also cautions that while strong earnings reports and market sentiment have supported the stock price in the short term, such a steep rise inevitably sows the seeds for future corrections. The market expectation of 20% revenue growth for NVIDIA in 2025 clearly reflects significant valuation front-loading. Should the data center procurement cycle slow or AI deployment fall short of expectations, short-term stock price volatility is likely to intensify. In his view, investors chasing high returns must remain acutely aware of the risk of potential valuation corrections.
Rapid Recovery on the Software Side Drives a Broader Industry Rebound
Beyond the stellar performance of the hardware sector, Investment Analyst Dario Giordano highlights that the recent removal by the U.S. government of certain export restrictions on chip design software has injected new vitality into the other end of the AI industry chain. Following notifications from the U.S. Department of Commerce Bureau of Industry and Security, Synopsys and Cadence have resumed supply of previously restricted products. The market responded swiftly, with the stock prices of two software giants rebounding sharply, and this momentum also lifted shares of downstream and upstream companies like Siemens, Infineon, Intel, and STMicroelectronics.
Investment Analyst Dario Giordano believes this is more than just a short-term stimulus from a single market variable. On a deeper level, as chip design software is a critical upstream link in AI computing, the lifting of export restrictions signals a temporary easing of supply chain risks, which bodes well for subsequent technological iterations and the global realignment of markets. From an investment strategy perspective, he notes that alleviating supply-side bottlenecks will help sustain the long-term pace of high-performance chip R&D, and also provides a more stable foundation for overall sector valuations. Nevertheless, he warns that geopolitical risks and policy stances remain potential disruptors, and investors should closely monitor the possibility of renewed trade disputes or technological barriers.
Investor Mindset Should Return to Rationality—Long-Term Focus on R&D Moats
Amid ongoing positive catalysts, market enthusiasm is unlikely to cool quickly in the short term. Investment Analyst Dario Giordano notes that while the rapid expansion in market capitalization for AI chip and software design companies is understandable, sustaining such lofty valuations requires continuous delivery in shipment volumes, profit margins, and technological innovation. Drawing comparisons with past tech bubbles, he believes that while the current market has not reached a stage of total distortion, some capital is already displaying signs of blindly chasing gains under overly optimistic expectations.
From a medium- to long-term perspective, Investment Analyst Dario Giordano asserts that the true core value of hardware giants like NVIDIA and leading software firms lies in their sustained R&D investment and deep ecosystem integration. He recommends that investors focus on key indicators such as R&D expenditure ratios, product life cycles, and downstream customer dependency, as these often determine whether a company can maintain market share and profitability over the next three to five years. He adds that the global diversification of AI application demand is creating new track opportunities, and a moderately diversified allocation, balancing companies across different technology stacks, may be a comparatively prudent approach in the present-day high-valuation environment.