San francisco: US chip giant Nvidia hit a $5 trillion market capitalization on Wednesday, marking it as the first public company in history to achieve this milestone. The company's shares rose by 5.1% as of 1340GMT, driven by the increasing demand for artificial intelligence (AI) technologies.

According to Anadolu Agency, Nvidia was the first firm to reach the $4 trillion market value threshold back in July. The chipmaker's recent surge in value is attributed to the booming interest in AI, which has also led US stocks to hit record highs for the second consecutive day on Tuesday. Tech giants Apple and Microsoft have both surpassed $4 trillion in market value, reflecting the sector's robust growth.

The California-based company, established in 1993, first crossed the $2 trillion mark in February 2024 and then the $3 trillion mark this June. Nvidia's market ascent comes shortly after CEO Jensen Huang announced expectations of $500 billion in orders for AI chips and revealed plans to construct seven new supercomputers for the US government.

In a significant move on Tuesday, Nvidia announced the acquisition of a $1 billion stake in Nokia to form a strategic alliance aimed at developing 6G cellular technology. The company's success is largely fueled by the rising demand for AI processors and equipment, notably following the advent of AI chatbots like ChatGPT.