What just happened? Remember when Apple was the most valuable company in the world? It held that position almost continuously for around 13 years before Nvidia knocked it off the top spot in 2024. Now, for the first time since 2019, Google parent Alphabet has seen its valuation surpass Cupertino, knocking its rival down to third – and a lot of people are blaming Apple's AI issues.
Alphabet shares closed up 2.5% yesterday, pushing its market cap to $3.892 trillion. Apple, meanwhile, has seen its shares fall more than 4% over the last five days to $3.863 trillion.
The change marks the first time that Alphabet's market cap has been greater than Apple's since January 29, 2019. It's also the first time that Alphabet has been the second-largest US company by market cap since February 26, 2018.
Alphabet's shares were up 66% throughout 2025, while Apple's were up a comparatively disappointing 9%. A lot of investors are pointing to the companies' contrasting AI successes as the reason why.
Google released its Gemini 2.5 Flash "nano banana" image model in August. The editor's abilities led to a slew of photorealistic pictures and videos appearing online, giving Google its own ChatGPT-style Studio Ghibli moment.
The Gemini app was also one of the most downloaded iPhone apps of the year, and there was more AI integration with Google products. While most consumers aren't fans of the latter, it helps drive up Alphabet's share price.
Google also revealed its TPU (tensor processing unit) v7 "Ironwood" accelerator in November as an alternative to Nvidia's hardware. This was followed by the Gemini 3 release in December and a new Gemini partnership with the Pentagon for its military AI platform.
Elsewhere, Google's cloud business signed more deals worth over $1 billion in 2025 through the third quarter of the year than in the two prior years combined, according to CEO Sundar Pichai. The company also avoided the worst possible outcomes in its federal antitrust case.
Apple, on the other hand, still hasn't launched the AI-enhanced version of its Siri voice assistant that it first unveiled in 2024 and has repeatedly postponed the update – it's supposed to land this year.
There's also Apple Intelligence, which has been dogged by criticism for being inaccurate and underwhelming, especially compared with rivals. One of the biggest related stories in 2025 was the fake news headlines that Siri kept generating in its summaries.
Both Apple and Alphabet still have a long way to go if they want to catch market-cap leader Nvidia. Team Green's AI endeavors have pushed its valuation to a massive $4.6 trillion, around $800 billion more than Alphabet.
Google's parent Alphabet surpasses Apple in market cap for the first time since 2019
