Apple is approaching a $4 trillion market value, driven by investors celebrating the company’s progress in artificial intelligence capabilities as a way to improve iPhone sales.
The company has moved ahead of Nvidia and Microsoft in the race to reach the milestone, thanks to a roughly 16% jump in shares since the beginning of November, which has added around $500 billion to the company’s market value.
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The rise in Apple shares reflects “investor enthusiasm for artificial intelligence and the expectation that the technology will result in a supercycle of iPhone upgrades,” said Maxim Group analyst Tom Forte, who has a “hold” recommendation.
Valued at around $3.85 trillion at last close, Apple surpasses the combined value of the main German and Swiss stock markets.
The Silicon Valley company, driven by so-called iPhone supercycles, was the first U.S. company to reach the previous trillion-dollar milestones.
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In recent years, Apple has been criticized for being slow to outline its artificial intelligence strategy, while Microsoft, Alphabet, Amazon and Meta were ahead.
Shares of Nvidia, the biggest beneficiary of AI, have risen more than 800% in the last two years, compared to the nearly doubling of Apple’s share value during the same period.
In early December, Apple got started on its devices, after revealing plans in June to integrate generative AI technology across its suite of apps.
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The company expects overall revenue to increase by “single to double digits” during its fiscal first quarter – a modest growth forecast for the holiday shopping season – raising doubts about the iPhone 16.
However, according to Lseg data, analysts expect iPhone revenue to recover in 2025.
“While near-term iPhone demand is still weak (…), it is a function of limited Apple Intelligence capabilities and geographic availability, and as both expand, this will help drive an improvement in iPhone demand.” , Morgan Stanley analyst Erik Woodring said in a note, reiterating Apple as the brokerage’s “top pick” for 2025.
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The recent surge in share value has pushed Apple’s price-to-earnings ratio to its highest level in nearly three years at 33.5, compared with Microsoft’s 31.3 and Nvidia’s 31.7, according to data from Lseg .
