Shares of Nvidia (NASDAQ: NVDA) surged higher on Tuesday, jumping as much as 5.6%. As of 11:54 a.m. ET, the stock was still up 5.1%.

The catalyst that sent the chipmaker and artificial intelligence (AI) specialist higher was word that another AI start-up had raised billions of dollars, which is likely good news for Nvidia.

xAI, the AI start-up founded by Elon Musk, announced on Sunday it had raised $6 billion in its latest funding round. The company said in a blog post that the influx of cash would be used "to take xAI's first products to market, build advanced infrastructure, and accelerate the research and development of future technologies." In a subsequent post on X (formerly Twitter), Musk said the series B funding round valued xAI at $18 billion.

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Source Fool.com