Apple has returned to the top of the global corporate valuation rankings, overtaking Nvidia as investors increasingly warm to the iPhone maker's relatively cautious approach to spending on artificial intelligence.
Apple shares gained 1.17% on Monday to close at a record $336.91, lifting the company's market capitalisation to around $4.94 trillion as per Yahoo Finance data. Nvidia, meanwhile, was valued at about $4.75 trillion after its shares dropped nearly 5%.
The latest move adds to a strong run for Apple shares, which have climbed more than 22% so far this year and outperformed the broader group of Magnificent Seven technology companies.
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Apple's AI Spending Strategy Draws Attention
One factor supporting Apple's recent stock-market performance is its decision to avoid matching the aggressive AI infrastructure spending underway at several of its Big Tech peers.
Apple's capital expenditure has declined over the past three quarters, even as rivals have committed increasingly large sums towards data centres, computing infrastructure and other resources required to develop and operate artificial intelligence systems.
The company had previously faced criticism for appearing to lag behind rivals in deploying artificial intelligence. However, concerns over the returns generated by massive AI investments have made Apple's comparatively capital-light approach more attractive to some investors.
Freedom Capital Markets Chief Market Strategist Jay Woods said Apple's limited AI spending has allowed the company to sidestep some of the capital expenditure challenges facing its peers.
"Once criticized for not spending more on AI, they have been able to avoid some of those capex pitfalls," he said.
Nvidia's decline on Monday also contributed to the change at the top. The chipmaker's shares fell 4.99% amid renewed concerns around AI infrastructure spending and financing arrangements in the sector.
Apple Earnings In Focus
Attention now turns to Apple's upcoming quarterly earnings, due after US markets close on Thursday.
Investors will be watching for updates on the company's artificial intelligence plans and, particularly, whether Apple can broaden the reach of Apple Intelligence without significantly increasing capital expenditure or putting pressure on operating margins.
The earnings will also provide Wall Street with another test of whether Apple's measured AI investment strategy can continue supporting its position at the top of the global market-cap rankings.
Also Read: Nvidia Mulls $250 Billion Backing For OpenAI Hub, WSJ Says
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