Nvidia’s Status as the World’s Biggest Company Could Could End Soon Thanks to a Familiar Rival

Alphabet Inc., parent of Google, is looking to overtake Nvidia’s reign as the world’s biggest company.

Both giants are still battling it out on the stock market, and Alphabet still needs to close a near $120 billion gap in order to top the market. Nvidia’s market cap last stood close to $4.79 trillion as of Tuesday morning, whereas Alphabet was at $4.67 trillion, according to Reuters. Nvidia has a previous all-time high on the market of around $5.2 trillion. But many experts are now projecting Alphabet to overtake its rival.

“It’s really about hyperscaler capex spend and, to some degree, early signs of better monetization – particularly from Alphabet – versus the broader AI ‘food chain,’ which includes data centers, grid and power,” Stephanie Link, chief investment strategist at Hightower Advisors, told Reuters.

The new move comes as Alphabet starts to emerge as a major AI service provider and rival to Nvidia in chips. The new custom processors from Alphabet have gone as far as winning over major players in the AI sector like Anthropic.

Stock Change

If the stock market leaderboard reshuffles, Google would take the No.1 spot for the first time ‌in more than a decade. It last held that position briefly in February 2016 before Apple claimed the spot.

Investors told Reuters that they think Google is scooping up a large chunk of new computing demand, thanks to its AI tools for businesses and custom chips. CEO Sundar Pichai said Google had begun selling its AI chips directly to consumers in order to compete with Nvidia’s semiconductors. Alphabet’s shares have surged about 24% this year, while Nvidia’s shares are up just about 7%, according to Reuters.

In its recent first-quarter results, Google saw growth, with revenue rising 22% year-over-year to $109.9 billion and net income jumping 81% to $62.6 billion. The company confirmed in its earnings call that a main driver was the surge in AI demand in Search and Cloud. Revenue from its Google Cloud segment grew 63% in the first quarter, a growth rate the company hadn’t seen since 2020, according to Reuters.

“High demand for cloud and AI offerings drove a ‘meaningful acceleration’ in growth, indicating to investors that ‌significant ⁠AI investments are paying off,” Jeff Buchbinder, chief equity strategist at LPL Financial, said.

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