Alphabet has reached a significant milestone by achieving a market valuation of $4 trillion. This achievement underlines the company’s intensified focus on artificial intelligence (AI), addressing previous concerns about its strategic direction.
Alphabet’s Ascendancy in Market Valuation
On Monday, Alphabet surpassed Apple’s market capitalization for the first time since 2019. This moment established Alphabet as the second most valuable company globally.
Investor sentiment towards Alphabet has dramatically shifted. The company’s stock has increased by approximately 65% in 2025, outperforming other tech giants listed in the Magnificent Seven stocks group. So far this year, the stock has risen an additional 6%, with a recent increase of 1.1% noted.
AI Focus Driving Growth
- Alphabet has mitigated concerns about losing its early advantage in AI.
- The company transformed its previously sidelined cloud division into a key growth driver.
- Investments from notable entities, including Warren Buffett’s Berkshire Hathaway, have also contributed to growth.
The newly launched Gemini 3 model has received positive reviews, putting pressure on competitors like OpenAI, especially following user dissatisfaction with GPT-5. A report from Reuters indicated that Samsung Electronics plans to double the number of mobile devices featuring AI capabilities powered by Google’s Gemini this year.
Cloud Revenue Surge
In the third quarter, Google Cloud’s revenue surged by 34%. The company reported a backlog of unrecognized sales contracts totaling $155 billion. Furthermore, Alphabet has begun renting its self-developed AI chips, previously reserved for internal use, to external clients. This move has accelerated growth in its cloud segment.
Indications of rising demand for its AI chips surfaced when The Information reported that Meta Platforms is negotiating a substantial investment in Alphabet’s chips for its data centers, projected to commence in 2027.
Steady Performance in Advertising
Despite economic uncertainties and fierce competition, Alphabet’s core advertising business has remained robust. Concurrently, the company became the fourth entity to achieve a $4 trillion market cap, joining the ranks of Nvidia, Microsoft, and Apple.
Additionally, a favorable ruling in September prevented a breakup of the company. This decision affirmed Alphabet’s control over its Chrome browser and Android mobile operating system, further supporting its market position.
