Apple unseats Nvidia to become world's most valuable company as AI bets shift

Apple overtook Nvidia on Friday to become the world's most valuable company, reshuffling the top ranks of tech heavyweights as investors reassess the outlook for artificial intelligence.

The shift marks Apple's return to the top spot for the first time since April last year.

How much are Apple and Nvidia worth now?

Apple was last valued at $4.88 trillion as its shares held steady, while Nvidia was valued at roughly $4.86 trillion following a 3.5% decline.

The gap between the two companies remains narrow, meaning either could reclaim the top spot depending on how investor sentiment shifts in the coming weeks.

Why did Apple overtake Nvidia?

The shift in the pecking order shows investors broadening their focus beyond the most obvious beneficiaries of the AI boom, such as Nvidia, which had led the rankings for nearly a year. "Apple was seen as a laggard in the AI race because it wasn't spending to develop models, but now sentiment has changed," said Toni Meadows, head of investment at BRI Wealth Management. She said Apple is less exposed to heavy capital spending and better positioned to monetise AI through services, ecosystem lock-in and hardware upgrades, reflecting confidence in earnings durability rather than speculative AI upside.

For a company often seen trailing in the AI race, the milestone reflects Apple's efforts to establish itself among the sector's leading players. The timing could also shape how CEO Tim Cook's final months at the helm are viewed, as he prepares to hand the role to hardware veteran John Ternus in September.

What is Apple doing to catch up in AI?

Last month, Apple rolled out a long-delayed overhaul of Siri, betting the upgraded assistant would help close the gap with Big Tech rivals and newer AI startups. Some analysts say Apple holds an AI advantage in the personal data stored on every iPhone, which could make Siri's responses more useful and the assistant more capable. That data remains locked within its operating systems for privacy reasons, meaning Apple would need to find a way to unlock its value.

Could Nvidia reclaim the top spot?

Nvidia became the first company to surpass a $5 trillion market valuation in October, a milestone that placed it far ahead of its rivals at the time. Being overtaken by Apple does not necessarily signal a lasting shift, since Nvidia remains a major beneficiary of AI-related spending and its graphics processors continue to power much of the generative AI boom. Nvidia could reclaim the top spot if investor sentiment shifts again.

Apple is also in a delicate position of its own, having raised prices on MacBooks and iPads to offset rising memory costs, a strategy that could dampen demand. "I don't see any meaningful distinction. Nvidia likely to be a significant participant in whatever happens going forward," said Benjamin Hall, vice president of alpha research at Segal Marco Advisors.

Which other chipmakers are benefiting from the AI trade?

AI enthusiasm has spread beyond Nvidia to other parts of the semiconductor industry this year. Memory chipmaker Micron crossed $1 trillion in market value in May, as investors recognised the growing importance of memory chips in AI infrastructure. South Korea's SK Hynix also listed on the Nasdaq earlier this month, adding another name to the race for investor attention.

"The new entrants to the market could spread out the focus away from the pure Magnificent Seven names into a wider number of names," Hall said. The chip rally hit turbulence in July as investors reassessed the sustainability of the AI trade, pulling the Philadelphia SE Semiconductor index down almost 19% from its all-time highs. Despite the steep fall, the index has still outperformed Nvidia so far this year.