Nvidia is losing ground as world’s most valuable company, says report. Who can be the first to hit $6 trillion?

Alphabet’s Google is rapidly closing the gap on Nvidia in the race to become the world’s most valuable public company for the first time in more than a decade, potentially overtaking AI chip maker Nvidia within weeks and its market value approaching $4.65 trillion after shares rose more than 140% last year. Barron’s.

The development marks a dramatic shift in the fortunes of one of the world’s best-known technology companies, whose shares soared more than 140% last year, nearly quadruple the gains in the previous four years.

Google’s shares currently have a market cap of about $4.64 trillion, adding more than $2.6 trillion in value last year and nearly $900 billion since January alone.

Google Closes Gap With Nvidia as Market Cap Race Tightens

Nvidia currently holds the title of the world’s most valuable company with a market value of $4.85 trillion. The chipmaker surpassed $5 trillion for the first time in October last year and reached a peak valuation of $5.27 trillion on April 27.

However, while Nvidia’s share price increases have been generally flat over the last six months, Google has increased by more than 36% in the same period. Based on recent trading momentum, the two companies could be separated by a razor-thin margin when Nvidia reports first-quarter earnings on May 20.

Nvidia’s average daily gain last month was about 0.66%, compared to Google’s 1.42%. According to Barron’s calculations, if this trend continues through May, Nvidia will only have a $190 million lead in Google’s market value at the time of its earnings update.

Google shares last traded at $381.80 each in late Friday trading; This brought Alphabet’s market capitalization to $4.65 trillion, a marginal decline of 0.04 percent. Nvidia rose 0.2% to $199.99 per share, bringing its market cap to just over $4.86 trillion.

Alphabet’s AI Across Search, YouTube, and Cloud Pays Off

The driving force behind Google’s resurgence is the deepening integration of AI across its three main business divisions: internet search, YouTube and Google Cloud. The company spent $144 billion on capital expenditures in the last two years, with another $490 billion allocated for the next two years.

Google Cloud’s backlog of orders increased by approximately $220 billion in the last quarter, reaching a record level of $462 billion. barron the report says. About half of this figure is expected to occur in the next two years; This is partly supported by the company’s recent entry into the chip sales market.

An analyst cited in Barron’s report said the latest quarterly results “reinforce our view that Google is a top AI play, driven by rising search usage, improving ad targeting, durable cloud benefits and growing subscription revenue from Gemini,” adding: “We think the tailwinds of AI for search are still in the early stages and future LLM improvements will support sustained growth.”

Google Last Remained at the Top for Just Two Days in 2016

The last time Google topped the S&P 500 market cap rankings was in February 2016, when it briefly surpassed Apple, which boosted its total value to $560 billion following a stronger-than-expected fourth-quarter earnings report. This reign lasted just two days before Apple regained its position on February 3.

With the biggest US tech gains of the current cycle reported, only Nvidia and Broadcom are left to post results over the next two months, leaving the field relatively open for Alphabet’s market cap to advance further.

Nvidia’s Vera Rubin Chips Still Retained Their Crown

Nvidia isn’t without its own short-term catalysts. According to Barron’s, the company’s next-generation Vera Rubin chips are expected to begin shipping in the second half of this year, adding new momentum to the business that is currently forecast to deliver 77% revenue growth in the April quarter.

Whether that will be enough for Nvidia to maintain its lead in the burgeoning Alphabet remains the key question occupying investors and analysts tracking the race to become the world’s first six-trillion-dollar company.