Nvidia Stock Surged 5% on Tuesday to an All-Time High. Here's Why.

Shares of Nvidia (NVDA +4.98%) jumped 5% on Tuesday to an all-time closing high of $201.03. This increase brings shares of the artificial intelligence (AI) tech leader to a year-to-date gain of 49.7%. For context, the S&P 500 index has returned 18.4% over this period.

Tuesday’s gain is attributable to Nvidia announcing a slew of new products and partnerships at its GTC Washington event. This is the first time the company has held a GTC (or GPU Technology Conference) in the nation’s capital. Its GTC held annually in March in the Silicon Valley is widely considered the world’s leading AI event.

Here’s what investors should know.

Nvidia is partnering with Nokia and investing $1 billion in the Finnish telecom

Nvidia announced much news on Tuesday at GTC Washington that investors surely liked. And the news that likely contributed the most to the stock’s jump is its partnership with Finnish telecommunications and information technology company Nokia (NOK +22.84%).

This strategic partnership also includes Nvidia investing $1 billion in Nokia. The aim of the partnership is to accelerate the development and deployment of next-generation AI-native mobile networks and AI networking infrastructure.

More specifically, according to the announcement, Nokia will add Nvidia’s “commercial-grade AI-RAN products” to its “industry-leading RAN portfolio, enabling communication service providers to launch AI-native 5G-Advanced and 6G networks on Nvidia platforms.”

While 5G is the fifth and current generation of wireless networking technology, RAN stands for radio access network. It uses a radio link to connect user devices, like smartphones, to the cellular network. This partnership should help boost Nvidia’s sales by expanding its total addressable market.

And naturally, Nokia investors loved the news that the biggest player in AI technology was partnering with and investing in their company. The telecom’s stock soared 22.8% on Tuesday.

Nvidia has been making big stock investments recently

Nvidia is looking increasingly like an AI exchange-traded fund (ETF), as it has recently made some big investments in publicly traded and private companies.

Perhaps most notably, in late September, Nvidia announced a strategic partnership with OpenAI, the AI model developer behind the incredibly popular ChatGPT chatbot. The partners plan to deploy at least 10 gigawatts of Nvidia systems for OpenAI’s next-generation AI infrastructure. And Nvidia plans to invest up to $100 billion in OpenAI.

In mid-September, Nvidia announced a collaboration with chipmaker Intel to jointly develop custom data center and personal computer (PC) products, including AI chips. And Nvidia said it planned to invest $5 billion in Intel stock.