New Year Blues For Apple: GOOGL Market Cap Surges Past iPhone Maker's After 7 Long Years, Powered By AI Push

Alphabet’s stock surged more than 65% last year – the strongest performance among the “Magnificent Seven.”

• Alphabet hit $3.89 trillion in market value on Wednesday, climbing past Apple’s $3.85 trillion
• The search giant is seeing strong momentum in its AI development, particularly the recently launched Gemini 3 AI model, which is driving its stock.
• Apple’s stock has fallen for six straight days, although retail investors are optimistic about a rebound.

Alphabet Inc. has overtaken Apple Inc. in market value, highlighting their diverging trajectories as investors increasingly favor companies seen as best positioned to drive – and benefit from – AI innovation.

The search giant hit $3.89 trillion in market capitalization, as the GOOGL stock jumped 2.4% on Wednesday. Apple has had a rather poor start to the new year – its stock has fallen for six straight sessions and cumulatively by 5% – and had a market cap of $3.85 trillion as of the day’s close. Alphabet last overtook Apple back in 2019.

Alphabet’s strong momentum is continuing into the new year. The company’s shares surged more than 65% last year – the strongest performance among the “Magnificent Seven” – fueled by a string of AI product launches and a late-year rally after its Gemini 3 model was widely hailed as best in class. 

The iPhone maker, on the other hand, has been a market laggard. Although sales stabilized, supporting Apple's market value surpassing $4 trillion for the first time in October 2025, investors are skeptical of the progress of the company’s long-promised AI functionality in its devices. After multiple delays, Apple has promised to launch the “more personal Siri” in 2026.

Interestingly, social media was also recently abuzz with reports that traffic to ChatGPT — Apple's preferred AI partner - had been tumbling since Google Gemini 3's launch.

Analysts are wary, too. Sixteen of the 49 analysts covering AAPL have given it a ‘Hold’ rating, and four rate it ‘Sell’ or lower, according to Koyfin. Last week, Raymond James told investors it sees limited upside for the stock, with no near-term fundamental catalyst.

However, retail investors are upbeat about Apple. The Stocktwits sentiment shifted to ‘extremely bullish’ as of late Wednesday, up from ‘bullish’ the previous day. User comments were mixed, ranging from frustration over recent stock weakness to expectations of an impending rebound.

Part of the recent optimism stemmed from a Wall Street Journal report that Apple was shifting from Goldman Sachs to JPMorgan as the operator of its credit card business.

Alphabet’s retail sentiment also shifted upwards, to ‘bearish’ from ‘neutral’ the previous day. 

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