"Old Deng" strikes back! Apple briefly surpasses NVIDIA to become the world's highest market cap company
When Nvidia fell about 2% in a single day due to the impact of the new AI model Kimi K3, Apple quietly overtook it with its "cost-effective AI strategy," briefly regaining the top spot for global market capitalization. With capital expenditure accounting for only 2.5% of its sales, the debut of the new Siri, and HSBC's rare upgrade to a buy rating—all these multiple catalysts combined to make Apple the most unexpected safe haven winner in the AI wave.
Apple adopts a "defensive" approach in the AI boom, briefly reclaiming the top spot in global market capitalization with its asset-light strategy and expectations for an AI revival.
On Friday, Nvidia’s stock fell about 2%, impacted by the launch of the new Kimi K3 model by Chinese AI developer Moonshot AI, causing a broad decline across tech stocks. Apple shares were nearly flat and its market cap briefly overtook Nvidia, regaining the title of the world’s most valuable company for the first time in over a year. By the close, Nvidia’s market cap was slightly ahead at $4.908 trillion compared to Apple’s $4.902 trillion, an extremely narrow margin.
This reversal reflects a deeper shift in market sentiment—investors are starting to reassess the relative value of “heavy investment” versus “asset-light” approaches in the AI race, with Apple increasingly seen as a safe haven in AI trading.
Nvidia Under Pressure, Apple “Wins by Doing Less” in the AI Logic That Doesn’t Burn Cash
The immediate trigger for the market cap swap was the release of the new Kimi K3 model, which again stoked skepticism over Silicon Valley’s massive AI infrastructure spending. As the core supplier of AI computing power, Nvidia came under fire, with its share price dropping roughly 2% in a single day.
At the same time, Apple did not follow the broader tech stock decline, pushing its market cap close to the $5 trillion threshold. Nvidia first surpassed the $5 trillion mark in October last year, becoming the first company in history to reach that milestone. Should Apple hold that level, it will become only the second.
Apple’s distinguishing feature in the AI sector is its intentionally low capital expenditure policy. According to HSBC analysts, only about 2.5% of Apple’s projected 2026 sales will be allocated to AI data centers and other capital expenditures, in stark contrast to the 39% spent by the “hyperscale cloud” giants like Meta, Google, Amazon, and Microsoft.
This comparison makes Apple appear particularly “stable” in the current market environment. While competitors commit hundreds of billions to building chips and data centers, Apple’s restraint has become a magnet for capital.
Multiple Catalysts Driving Stock Rebound
Apple shares have risen roughly 20% since the end of June, with a string of positive catalysts landing one after another.
The redesigned Siri voice assistant was officially unveiled last month, earning widespread positive feedback from the market; Chinese regulators signaled that Apple’s new AI system could soon be launched in the world’s biggest smartphone market, further boosting investor confidence.
Meanwhile, Apple is negotiating with the Trump administration for approval to source memory chips from Changxin Memory, a move that could help alleviate mounting component cost pressures.
Apple has also launched a legal challenge against OpenAI, accusing the company of poaching its former employees and stealing trade secrets after they joined the ChatGPT parent. The move has been interpreted positively by Wall Street.
Wall Street Upgrades Rating, Bullish on AI Product Cycle
On Friday, HSBC analysts upgraded Apple to “Buy,” making it one of the few major Wall Street banks yet to hold a Buy rating previously. HSBC stated in a research note that Apple “has all the prerequisites to leverage the soon-to-be-launched enhanced Apple Intelligence and unlock value from its enormous base of 2.5 billion installed devices.”
HSBC also emphasized that “this AI boost comes at an opportune time, and we believe Apple currently has one of the most innovative product pipelines in its history,” further predicting that the first foldable iPhone will launch in September.
However, Apple has not been without setbacks. Last month, Apple announced price hikes of up to 20% for iPad and Mac products and warned of “unusual surges in memory and storage demand,” leading to the steepest single-day stock drop since last year’s tariff scare during the Trump administration. But with these aforementioned catalysts emerging, the share price quickly stabilized and recovered.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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