NVIDIA's AI chips laid the groundwork for a massive wave of venture capital investments in AI startups.

From the first quarter of 2023 — following the launch of ChatGPT in November 2022 — through the first quarter of this year, venture capitalists have invested $306.5 billion in global AI and machine learning startups and private companies, with $230 billion of that value going to US firms, according to PitchBook data.

And over that time frame, AI and machine learning companies accounted for roughly 48% of the total venture capital investments in the US.

“ChatGPT’s breakout showed that large language models could scale into real products, which sparked a sharp rise in investor appetite,” PitchBook AI analyst Dimitri Zabelin told Yahoo Finance in an email. “Nvidia played a central role by supplying the compute backbone.”

In the first quarter of 2025 alone, Zabelin explained, global VC investments in artificial intelligence and machine learning totaled $76.5 billion and accounted for over 70% of the value of all venture capital deals during the period. Some $66 billion of those investments were in US AI companies.

Artificial intelligence has been around for decades, and AI researchers began experimenting with the use of Nvidia’s GPUs in the early 2000s to power the technology, finding that it was more effective than “traditional” computing chips called CPUs (central processing units). Then in 2011 and 2012, AI computing models powered by Nvidia’s AI-enabled GPUs began attracting widespread attention from both the academic community and Silicon Valley, including Sam Altman, whose startup OpenAI launched the chatbot ChatGPT in 2022 that brought AI mainstream.

Nvidia shares have soared over 670% since the debut of ChatGPT, compared to the S&P 500’s more modest 42% gain.

“As GPU demand surged, it reinforced the view that AI represents a durable investment cycle,” Zabelin said. According to Bloomberg estimates, Microsoft and Meta spend roughly 47% and 25% of their capital expenditures on Nvidia’s chips, respectively, on an annualized basis.

“That in turn set off a flywheel of product-market fit, infrastructure buildout, and accelerating capital flows,” Zabelin added. Since the first quarter of 2024, more than 20,000 artificial intelligence deals have closed in private markets, totaling $330 billion.

Nvidia is set to report quarterly earnings on May 28.

Wall Street analysts expect Nvidia to report soaring earnings and revenue for its fiscal 2026 first quarter (the April quarter), though they expect its growth to continue decelerating.

Analysts project revenue will rise over 66% to $43 billion in the first quarter and adjusted earnings per share to leap 44% to $0.88. By comparison, in the first quarter of last year, Nvidia reported revenue rising a staggering 262% and earnings per share growing 461%.

Options traders tracked by Bloomberg predict Nvidia shares could gain or lose as much as 7% immediately following the results.