Apple vs Nvidia: The Battle for a Trillion, or How the iPhone Outpaced AI Chips
On Friday, a significant, albeit fleeting, moment occurred in the market: Apple briefly overtook Nvidia in market capitalization, becoming the world's most valuable company. The gap between the giants narrowed to a minimum, and this event deserves close analysis.
Apple (AAPL) shares surged 1.76%, reaching an all-time high of $333.26, while Nvidia (NVDA) shares corrected 2.40% to $207.40. In the first minutes of trading, Apple's market cap reached $4.92 trillion compared to Nvidia's $4.86 trillion. Although Nvidia regained the lead by the main session ($5.02 trillion vs. Apple's $4.89 trillion), the difference between them narrowed to a symbolic $130 billion.
Shift in Vector: From AI Euphoria to Consumer Demand
The key driver of this dynamic is a shift in market sentiment. Amid profit-taking in the AI sector, which began in early July, investors have turned their attention to Apple. Over the past week, AAPL shares have gained more than 7%, while NVDA has lost nearly 4% over the month. The Nasdaq 100 heatmap clearly illustrates this: Apple is one of the few mega-cap companies remaining in the "green zone," while the entire chip sector came under pressure. Alphabet, Broadcom, and AMD lost between 4% and 5%.
Apple's growth is fueled by strong demand for the iPhone 17 and record results from its services division, which brought in $30.98 billion last quarter. Additionally, buyers shifted to the premium segment amid a shortage of AI memory. For Nvidia, despite quarterly revenue growing 85.2% (to $81.6 billion) and its data center segment rising 199%, investors chose to lock in profits after a historic rally.
What's Next? Apple's Report as a Trigger
The next key event will be Apple's earnings report on July 30. It could determine who holds the throne for the next month. Analysts will focus on services growth, revenue from China ($25.53 billion last quarter), and early signals about the iPhone 18. The probability of a new model announcement this year is estimated at 96% on Polymarket.
From a fundamental perspective, Nvidia looks more attractive: its PEG ratio is 0.6, with a target quarterly revenue of $91 billion and a gross margin of around 75% (compared to Apple's 49%). However, Apple trades at a multiple of around 32, justified by a streak of eight quarters of earnings per share growth, a new $100 billion buyback, and a $30 billion deal with Broadcom, strengthening its position in the chip segment.
On the daily chart, AAPL updated its all-time highs, breaking through the key resistance level of $315. The move is supported by strong momentum: the RSI has exceeded 70, indicating bullish dominance, though it also signals a possible local correction. If Apple's report on July 30 is strong, especially in the "Services" and "China" segments, the company could solidify its success. If weaknesses emerge, Nvidia will have a chance to surge ahead again before its own August report.
My analysis: This situation is not just a coincidence but a reflection of a structural shift. The market is no longer "one-sided" and is beginning to reassess the value of companies whose business models are less dependent on the volatile AI cycle. The battle for the trillion will now be determined not only by growth rates but also by the ability to generate stable cash flow.