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

Apple was last valued at $4.88 trillion as its shares remained flat, while Nvidia was worth around $4.86 trillion after a 3.5% decline.

The change in the pecking order shows that investors are focusing their attention on the most obvious beneficiaries of the AI ​​boom, such as Nvidia, which has been at the helm for nearly a year. Apple is reclaiming the top spot for the first time since April last year.

“Apple was seen as a laggard in the AI ​​race because it wasn’t spending to develop models, but now the sentiment has changed,” said Tony Meadows, head of investments at BRI Wealth Management.

“Apple is sharply less exposed to capex and better positioned to monetize AI through services, ecosystem lock-in and hardware upgrades. The re-rating reflects confidence in earnings sustainability rather than speculative AI upside.”

For a company often seen as a laggard in the AI ​​race, the milestone reflects Apple’s efforts to establish itself more firmly among the sector’s leading players and could shape how CEO Tim Cook’s final months at the helm are viewed.

Cook is preparing to hand over his role to hardware veteran John Turnus in September.

Last month, the company launched a long-delayed overhaul of Siri, which will help the upgraded assistant close the gap with big tech rivals and new-age startups in the crucial AI race.

Some analysts say Apple is sitting on an AI gold mine in the form of personal data that resides on every iPhone. Data can make Siri’s answers more useful and the Assistant more capable.

The challenge is that such data is locked away in the operating system in the name of privacy and the company has to find a way to unlock its value.

AI Spending Lifts New Winners

Nvidia became the first company in the world to surpass $5 trillion in market valuation in October, a milestone that propelled it into rarefied territory that is beyond the reach of its rivals.

A move by Apple does not indicate a permanent change in the companies’ respective positions. The chipmaker remains a major beneficiary of AI-related spending, and its graphics processors largely power the generative AI giant.

Nvidia could also reclaim the top spot if sentiment changes.

In addition, Apple itself is in a fragile position, raising prices to offset rising costs — a strategy that could hurt demand.

“I don’t see any meaningful difference. Nvidia is likely to be a significant participant in whatever happens next,” said Benjamin Hall, vice president of Alpha Research at Segal Marco Advisors.

However, AI enthusiasm has spread to other corners of the semiconductor industry. The big winners this year are memory chipmakers like Micron, which surpassed $1 trillion in market value in May as investors embraced the importance of memory chips in AI infrastructure.

South Korea’s SK Hynix also listed on the Nasdaq earlier this month, adding another player to the race for investor attention.

“New entrants to the market can focus away from the pure Magnificent Seven names into a wider number of names,” Hall said.

Chips’ eye-watering rally in July turned sour as investors reassessed the sustainability of the artificial intelligence trade, knocking the Philadelphia SE Semiconductor Index down nearly 19% from its all-time high.

Despite the steep decline, the index has outperformed Nvidia so far this year.