Nvidia (NASDAQ: NVDA) stock has been on a tear on the stock market over the past year and a half, which is not surprising -- the company has been delivering phenomenal earnings and revenue growth thanks to the booming demand for its artificial intelligence (AI) chips.

Nvidia commands a dominant position in the AI chip market with a market share of more than 90%. It is leagues ahead of rivals such as Intel and , which are still looking to cut their teeth in this market. For example, Nvidia is expected to sell $87 billion worth of AI chips this year. AMD and Intel, meanwhile, are expecting to generate $4 billion and $500 million, respectively, from AI chip sales this year.

Nvidia is clearly the go-to chipmaker for companies that are looking to train and deploy AI models, as its share of this market illustrates. The stock market has rewarded the company's dominance handsomely, which is evident from the 507% jump in its share price since the beginning of 2023. This stunning rally has brought Nvidia's trailing earnings multiple to 74, which is quite rich if you consider that the Nasdaq-100 index has an earnings multiple of 30 (using the index as a proxy for tech stocks).

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Source Fool.com