Nvidia's Jump Boosts AI, Semiconductor ETFs

Maker of gaming chips, held by 361 funds, boosts BOTZ, USD and others.

Reviewed by: Michelle Lodge
Edited by: Michelle Lodge

Nvidia Corp. stock soared 14% today as the maker of gaming and artificial intelligence chips reported results that topped Wall Street expectations, in turn boosting AI, semiconductor and other tech exchange-traded funds.  

The top holder of Nvidia, the ProShares Ultra Semiconductors (USD) with a 19% allocation in the stock, jumped 9.2%. The Global X Robotics & Artificial Intelligence ETF (BOTZ), which invests in AI companies and whose top holding is Nvidia, at 9.6%, rose 2.1%. 

Nvidia is held in 361 ETFs, the fifth most-widely held stock, according to ETF.com data. The largest holder, the Invesco QQQ Trust (QQQ), with approximately 32.1 million shares, gained about 1% today. U.S. ETFs allocate an average of 2.5% of Nvidia to their portfolios. 

Demand for artificial intelligence devices is gaining, Nvidia CEO Jensen Huang said in a statement. AI has been catching fire thanks in part to widespread attention to the ChatGPT chatbot and efforts from Google parent Alphabet Inc. and Microsoft Corp. to catch up. Jensen recently called ChatGPT the “iPhone moment” for AI. 

“AI is at an inflection point, setting up for a broad adoption reaching into every industry, from startups to major enterprises. ” Huang said in a statement. “We’re seeing accelerated interest in the versatility and capabilities of generative AI.” 

Nvidia topped revenue and earnings expectations as it undershipped so its gaming sector could clear out inventory and ready customers for products with its newer Lovelace gaming chips, Needham & Co. analyst Rajvindra Gill told CNBC on Thursday. 

"There's a significant upgrade cycle that’s happening,” he said. “We’re seeing a rebound in the gaming segment.” 

NVDA’s stock price has risen nearly $100 per share year to date, trading around $235 on Thursday afternoon. The stock was trading as low as $115 on Oct. 12. 

Top-performing ETFs that hold Nvidia include the Simplify Volt RoboCar Disruption and Tech ETF (VCAR), up 25% over the past 30 days, and the ProShares UltraPro QQQ (TQQQ), up 19% over the same period. 

A recent proposed deal with Microsoft bodes well for NVDA. On Feb. 21, the software giant announced that the two corporations agreed to a decade-long union to bring its “Call of Duty” and other Activision games to NVDA’s platform, subject to regulatory approvals. 


Follow Michelle Lodge on Twitter @lodgemich 

Michelle Lodge is a journalist who is a contributor to many sites: Fortune, Money, Time, Barron’s, Investopedia, CNBC.com and Bloomberg.com.