Nvidia has grown from a maker of gaming chips into a major supplier of AI technology; its powerful chips, software and early investments have helped it become a global tech giant
Nvidia was founded on April 5, 1993, by Jensen Huang, Chris Malachowsky and Curtis Priem. (Image: Bloomberg)
Rimjhim SinghNew Delhi7 min read Last Updated : Nov 13 2026 | 11:48 AM IST
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Nvidia has emerged as one of the biggest beneficiaries of the artificial intelligence (AI) boom, becoming a key supplier of the chips that power some of the world’s most advanced AI systems. Once known mainly for making graphics chips for video games, the US-based company has transformed itself into a major force in data centres, AI computing and advanced technology.
Its rise has been driven by years of investment in chip technology, software development and a shift towards AI computing. However, its growing importance has also brought it into the middle of the technology rivalry between the United States and China, with restrictions on the sale of its advanced chips threatening its access to one of the world’s largest markets.
However, the chipmaker is now facing growing scrutiny in the US following controversy surrounding its founder Jensen Huang, its China business and allegations involving a suspected Chinese spy.
Here is a look at how Nvidia started, what it does and why it has become so valuable.
How Nvidia started: From gaming to computing
Nvidia was founded on April 5, 1993, by Jensen Huang, Chris Malachowsky and Curtis Priem. According to the company’s corporate timeline, the founders wanted to develop technology that could improve 3D graphics in video games and multimedia applications.
The company initially focused on graphics processing units (GPUs), chips designed to handle the complex calculations needed to produce images and videos on computer screens.
In 1999, Nvidia introduced the GPU, helping transform computer graphics and the gaming industry. Its GeForce range later became widely used in gaming computers.
However, the technology had applications beyond video games. Unlike central processing units (CPUs), which generally handle tasks one after another, GPUs can perform many calculations simultaneously. This makes them useful for processing large volumes of data.
Nvidia began exploring these applications well before the current AI boom. In 2006, it introduced CUDA, a software platform that allowed developers and researchers to use GPUs for scientific research and other computing tasks. This proved important in preparing the company for the growth of AI.
ALSO READ: Meet Colette Kress, Nvidia’s interim CEO after Jensen Huang’s exit
What does Nvidia do?
Nvidia designs GPUs, computer chips and related software and systems used for high-performance computing. It does not manufacture most of its chips itself. Instead, it relies on semiconductor manufacturing partners to produce the designs.
Its products serve several industries, including gaming, automotive, healthcare, robotics and scientific research. However, data centres have become its biggest growth engine.
AI systems require enormous computing power to process information, recognise patterns and generate responses. Nvidia’s GPUs are designed to handle these workloads, making them useful for both training AI models and running them after they have been developed.
The company also provides networking equipment, software and complete computing systems that help businesses build AI infrastructure.
In effect, Nvidia is no longer just a chip supplier. It provides much of the technology needed to build and operate large-scale AI systems.
How the AI boom made Nvidia a giant
The launch of OpenAI’s ChatGPT in November 2022 brought generative AI into the mainstream and triggered a sharp rise in demand for computing infrastructure.
Technology companies began investing heavily in data centres and AI systems to develop and operate their own models. This created enormous demand for powerful GPUs, a market in which Nvidia already had a strong position.
According to Bloomberg, Nvidia’s share price rose around 14-fold from the launch of ChatGPT to its peak on October 6, 2026.
Major technology companies, including Microsoft, Amazon and Alphabet, have emerged as important customers as they expand their AI infrastructure. The scale of this demand has helped Nvidia grow rapidly and become one of the most valuable companies in the world.
What separates Nvidia from its competitors?
Nvidia’s advantage is not limited to the performance of its chips. Its combination of hardware, software and computing infrastructure has made it difficult for competitors to match its position.
One of its biggest advantages is CUDA. Over the years, technology companies have built applications around this platform. This has created an established ecosystem of developers, software and tools that competitors must overcome to attract customers.
Nvidia has also maintained its lead by regularly introducing new chip designs and investing in its computing infrastructure.
Nvidia accounts for more than 80 per cent of the market for high-end chips used in AI and data centres, based on some estimates.
Companies such as Advanced Micro Devices (AMD) and Google have developed or are developing competing chips. Chinese technology company Huawei is also working to strengthen its position in AI computing.
How big is Nvidia in terms of market value?
Nvidia crossed the $4 trillion market-value mark in 2025 and later became the first company to cross $5 trillion.
Its valuation approached $6 trillion in October 2026, according to Bloomberg data. However, its shares have since come under pressure.
As of November 13, Nvidia’s market capitalisation stood at approximately $4.01 trillion. This places it among the world’s most valuable publicly listed companies.
The company’s size also means its stock movements can affect the wider US stock market. According to Bloomberg, Nvidia accounted for around 8 per cent of the S&P 500’s total value for much of the past two years.
Why has the US restricted Nvidia’s chip sales to China?
Nvidia’s chips have become a key part of the technology rivalry between the United States and China.
Advanced semiconductors are essential for developing powerful AI systems. These systems can have applications in areas such as military research, intelligence gathering, surveillance and advanced weapons.
The US government is concerned that China could use advanced computing chips and the technology needed to manufacture them to strengthen its military capabilities.
In October 2022, the US Department of Commerce’s Bureau of Industry and Security introduced export controls to restrict China’s access to advanced computing chips and semiconductor manufacturing technology. The restrictions aimed to limit China’s ability to develop advanced military systems and supercomputing capabilities.
The rules have since been tightened and revised, affecting several Nvidia products, including its A100, H100 and H20 chips.
The restrictions have also changed over time. In April 2025, the US government informed Nvidia that exports of its H20 chips to China would require licences. The company said in its regulatory filing that this resulted in a $4.5 billion charge in the first quarter of fiscal year 2026 due to excess inventory and purchase commitments.
Even when Washington has allowed certain shipments, Beijing has imposed its own restrictions. In a filing with the US Securities and Exchange Commission (SEC), Nvidia said Chinese government restrictions had prevented it from selling some H20 and H200 products to customers in China. The restrictions have created challenges for Nvidia in a market where local companies, including Huawei, are trying to develop alternatives.
The company has also warned that losing access to China’s data centre market could affect its business and allow competitors to build stronger customer and developer networks.
For now, Nvidia remains central to the global AI industry. Its early investment in GPU technology, its CUDA software ecosystem and its ability to supply the computing infrastructure needed by major technology companies have helped it build a lead that competitors are still trying to close.
Topics :Nvidiaartifical intelligenceTech companiesUS tech giantsIT IndustryBS Web Reports
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First Published: Nov 13 2026 | 11:47 AMIST
