Defying Bubble Fears, Nvidia Drove S&P 500 Higher in 2025

Despite some significant ups and downs along the way, Nvidia's share price climbed almost 40 percent in 2025, as the company continued to defy fears of an AI bubble. In its latest earnings report, the chipmaker once again blew away expectations, as demand for its AI chips remains "off the charts," as the company's founder and CEO Jensen Huang recently stated. Considering its role at the heart of the AI revolution, it's no surprise that no company is currently watched more closely than Nvidia. But it's not only Nvidia's symbolic role as the AI poster child that has the potential to move markets, it is its sheer size as the world's most valuable company as well.

Due to the fact that the S&P 500 is a market-cap-weighted index, the performance of mega cap companies such as Nvidia, Apple and Microsoft, all valued above or just under $4 trillion, is particularly important to its overall performance. According to Howard Silverblatt, Senior Index Analyst at S&P Dow Jones Indices, Nvidia was once again the biggest driver of the S&P 500's performance last year. The index returned 17.9 percent in 2025, with Nvidia alone accounting for 15.5 percent of the overall gain. That puts the company ahead of Alphabet, Microsoft and Broadcom, who accounted for 13.5, 7.4 and 7.2 of the S&P 500's return, respectively.

At the other end of the scale, UnitedHealth was the largest negative contributor to the index's performance, followed by Fiserv, Salesforce and Accenture. These companies saw their share prices drop by 20 (Saleforce) to 67 percent (Fiserv), but due to their limited weight in the index, their contribution only accounted for minus 13 percent of the index's overall performance, dragging its return down 2.33 percentage points on aggregate.