Apple Officially Overtakes Nvidia as World's Most Valuable Company

Apple has successfully overtaken Nvidia as the world’s most valuable company. This change in position indicates that investors are beginning to reassess the prospects of companies that have been the primary beneficiaries of the artificial intelligence (AI) boom. Apple’s latest market capitalisation was recorded at around US$4.88 trillion. Meanwhile, Nvidia stood at approximately US$4.86 trillion after its shares fell 3.5%. Apple reclaimed the top spot for the first time since April last year. Previously, Nvidia had led the list of the world’s largest companies by market value for nearly a year. This ranking change reflects a shift in investor views on the prospects of the AI industry. Investors are no longer focusing solely on companies that directly supply technology for AI development, such as Nvidia. “Apple was considered a laggard in the AI race because it did not spend heavily on developing AI models, but now sentiment has changed,” said Toni Meadows, chief investment officer at BRI Wealth Management. “Apple has lower exposure to capital expenditure intensity and is in a better position to monetise AI through services, ecosystem stickiness, and hardware upgrades. This re-rating reflects confidence in earnings resilience, not speculative upside from AI,” he continued. For Apple, this achievement signals that the company is beginning to strengthen its position amid the AI competition. This momentum could also influence the assessment of CEO Tim Cook’s final period of leadership. Cook is scheduled to hand over his position to hardware veteran John Ternus this September. Apple has also started to accelerate its steps in the AI race. Last month, the company launched a major overhaul of Siri, which had been delayed for quite some time. Apple hopes the latest version of the virtual assistant can narrow the gap with large technology companies and start-ups that are now its competitors in the AI race. A number of analysts believe Apple has vast resources to develop AI, namely the personal data stored on every iPhone. This data has the potential to make Siri’s answers more relevant and enhance the digital assistant’s capabilities. However, Apple faces a major challenge because this data is locked inside its operating system on privacy protection grounds. The company must find a way to harness the value of that data without compromising its commitment to user privacy. Nvidia previously became the world’s first company to breach a US$5 trillion market capitalisation last October. That achievement brought Nvidia to a level that was previously difficult for its competitors to reach. Although it has now been overtaken by Apple, this change does not necessarily signal a permanent shift in position. Nvidia remains one of the biggest beneficiaries of the surge in AI spending. Nvidia’s graphics chips are also a key component underpinning the development of generative AI technology. Therefore, Nvidia still has the opportunity to reclaim the top spot if investor sentiment changes. On the other hand, Apple also faces challenges. The company has raised the prices of several of its products to offset rising costs. This strategy has the potential to suppress consumer demand. “I don’t see a meaningful difference. Nvidia will most likely remain a key player in whatever happens going forward,” said Benjamin Hall, vice president of alpha research at Segal Marco Advisors. Enthusiasm for AI is also beginning to spread to other semiconductor sectors. One of the biggest beneficiaries this year has been memory chip manufacturers such as Micron. Micron managed to breach a US$1 trillion market capitalisation in May after investors increasingly recognised the importance of memory chips in AI infrastructure. South Korean company SK Hynix, which also listed on the Nasdaq earlier this month, has added to the number of players vying for investor attention. “New entrants to the market can spread investor focus from the pure Magnificent Seven names to a broader set of companies,” Hall said.