Jim Cramer reflects on Nvidia's impact after record-breaking market cap

When it comes to Nvidia, own it, don't trade it, says Jim Cramer

CNBC’s Jim Cramer on Wednesday reflected on the significance of one of his long-time favorite stocks, Nvidia, just after the artificial intelligence powerhouse became the first company to amass $4 trillion in market cap during trading.

“The fact is, neither Microsoft nor Apple can claim that they’re currently creating a new industrial revolution, like Nvidia can,” he said. “In fairness, they did create the last industrial revolution, the rise of the personal computer, although that was a long time ago.”

Nvidia topped $4 trillion for the first time during the day’s session, but it closed up 1.8% to settle at a market cap of $3.97 trillion. The chipmaker is the world’s most valuable company, larger than competitors Microsoft and Apple, who have both formerly held that title. Nvidia surpassed $2 trillion in February of last year and climbed above $3 trillion four months later.

The tech giant has exploded over the past few years as Wall Street and the enterprise fixate on generative AI. Nvidia’s products are broadly seen as best in class, and Big Tech hyperscalers have been clamoring for them as they compete in the AI arms race and seek to benefit from the most advanced AI models.

Cramer remarked on AI’s transformative potential, and he suggested that “every single computer with a GPU that’s not as good as Nvidia’s is obsolete.” He also indicated that Nvidia’s technology will change the way businesses operate, saying it enables humanoid robots and self-driving cars. These robots can perform mundane or dangerous jobs, and they could event replace a number of white collar workers, Cramer continued.

Nvidia is a valuable player for the U.S. in its trade relationship with China, Cramer continued. The company sometimes seems to be the U.S.’s “only bargaining chip” with China, he said, as the country wants Nvidia’s products. Even though China is one of the U.S.’s top manufacturers, Cramer said he thinks Nvidia is a bigger bargaining chip than anything that China has.

“Bottom line? Nvidia, own it, don’t trade it,” he said. “Oh, and see you at $5 trillion.”

Nvidia declined to comment.