Alphabet Inc. has achieved a remarkable milestone. The company crossed the $4 trillion market capitalization mark on Monday. This achievement firmly establishes Alphabet as a major winner in the artificial intelligence trade.
A Historic Financial Threshold
Shares of Alphabet closed up 1% at $331.86. This price point pushed the company's total market value just over $4 trillion. Only a handful of corporations have ever reached this financial height. Nvidia Corp., Apple Inc., and Microsoft Corp. are the other members of this exclusive club. Nvidia remains the sole company to ever surpass $5 trillion.
Alphabet recently overtook Apple to become the world's second-largest company by market cap. It now sits behind only Nvidia. This shift underscores the growing investor focus on artificial intelligence leaders.
Strategic Apple Partnership Boosts Confidence
The market gain on Monday was fueled by significant news. Alphabet entered into a multiyear agreement with Apple. The deal will see Alphabet power Apple's AI technology. This includes the Siri voice assistant system.
This partnership is a major coup for Alphabet. It demonstrates the strength and reliability of its AI infrastructure. Apple's stock also saw a modest rise of 0.3% on the same day, reflecting positive market sentiment around the collaboration.
Impressive Stock Performance
Alphabet's stock has shown tremendous strength. It has risen 6% since the beginning of this year. This builds on an extraordinary rally in 2025, where shares gained more than 65%. That performance made Alphabet the top performer among the so-called Magnificent Seven tech stocks.
The gains over 2025 added nearly $1.5 trillion to the company's market valuation. This explosive growth highlights intense investor enthusiasm for Alphabet's AI prospects.
Dominance in Key AI Areas
Market sentiment toward Alphabet is rapidly improving. Analysts see the company holding dominant positions across critical areas of artificial intelligence. Positive reviews for its latest Gemini AI model have eased concerns about competition from rivals like OpenAI.
Furthermore, Alphabet's tensor processing unit chips are viewed as a potential significant driver of future revenue growth. These proprietary chips could give the company a lasting competitive edge.
"The company's competitive advantages are not only intact but growing," said Divyaunsh Divatia, a research analyst at Janus Henderson Investors. "No other player has the models, compute, applications, talent, and data to succeed in AI like Alphabet does. It is certainly being seen as a big AI winner."
Valuation and Investor Endorsement
Alphabet shares currently trade around 28 times estimated earnings. This is nearly their highest level since 2021 and notably above their 10-year average of 20.5. The company's price-to-earnings multiple had fallen to nearly 14 in mid-2025, making the recent expansion even more striking.
Despite its soaring valuation, Alphabet still trades at a slight discount to the overall Magnificent Seven Index. The company also received a rare and powerful endorsement from the investment world.
Warren Buffett's Berkshire Hathaway Inc. revealed in November that it built a stake in Alphabet during the third quarter. This move represents a significant show of confidence from the legendary investor, who is typically less exposed to technology stocks. Such validation adds further credibility to Alphabet's long-term growth story in AI.
