Shares of semiconductor giant Nvidia Corp. (NVDA) jumped 5% in early trading on Monday, amid rising optimism around strong demand for artificial intelligence chips ahead of CEO Jensen Huang's keynote address at the CES tech show.
The stock was poised for a record closing high, embodying the momentum in the AI chip trade to start 2025. Nvidia's rally added to gains of nearly 11% over the past three sessions, spurred by reports of robust sales for its AI server products at a key Taiwan-based supplier.
On Sunday, Foxconn -- the major assembler of Apple iPhones and Nvidia chips, formally known as Hon Hai Precision Industry -- posted record fourth-quarter revenue, driven by "strong demand from AI servers." The chip contractor's results offered an upbeat sign about the ramp of Nvidia's next-generation Blackwell AI chips, whose initial rollout was slowed by manufacturing issues last year.
Other semiconductor stocks also surged Monday, with the PHLX Semiconductor Index rallying 3.7% to hit a two-month high. Chipmakers like Micron Technology (MU), Advanced Micro Devices (AMD), and Taiwan Semiconductor (TSM) -- a major Nvidia supplier -- posted strong gains as well, riding the AI optimism.
Later Monday evening, Nvidia CEO Huang is set to give a keynote speech at CES in Las Vegas where he is expected to provide updates on Blackwell chip demand and potentially unveil new AI products. Analysts anticipate the speech could further catalyze the semiconductor sector and reinforce Nvidia's dominance in supplying chips that power AI applications and data centers.
