$4.8 trillion.
That was Alphabet's market value at Friday's close. The stock is up 160% over the past 12 months, including a 34% jump in April alone, its strongest month since 2004.
A year ago, investors were still discounting Google as an AI laggard.
A year ago, investors would not pay for Google's AI story
The timeline now looks striking. On October 31, 2025, Nvidia was worth $4.9 trillion, while Alphabet stood at $3.4 trillion, leaving a gap of nearly $1.5 trillion. Then the spread narrowed fast.
By May 2026, Nvidia had gained 6.3%, while Alphabet had risen 43%. The two companies are now close in market value: Nvidia at $5.2 trillion and Alphabet at $4.8 trillion. Apple, at $4.3 trillion, trails behind, with Microsoft at $3.1 trillion and Amazon at $2.9 trillion.
| Company | Market value |
|---|---|
| Nvidia | $5.2T |
| Alphabet | $4.8T |
| Apple | $4.3T |
| Microsoft | $3.1T |
| Amazon | $2.9T |
Luke O'Neill, CIO at CooksonPeirce Wealth Management, put it bluntly: "Alphabet touches almost every corner of the AI ecosystem. Put everything it can offer together, and it is one of the strongest candidates to be the biggest winner in AI."
In plain English: buying Nvidia gives investors the picks and shovels. Buying Alphabet looks more like buying the picks, the mine and the map seller at the same time.
The latest earnings finally made the story add up
The catalyst was concrete. Google Cloud revenue in Q1 reached $20 billion, up 63% year over year. Its backlog doubled to $460 billion, meaning contracted revenue not yet recognized and, in effect, AI demand locked in for years ahead.
TPU is the other line of attack. Google's in-house AI chips were once mainly for internal use; now the company is starting to sell them externally. TPU revenue could reach $3 billion this year and $25 billion next year. Sundar Pichai said on the earnings call that TPU chips would soon let Google Cloud customers run them in their own data centers.
The implication is direct: Alphabet is trying to take business from Nvidia. Anthropic's $21 billion order for Google's TPUs did not appear out of nowhere.
Divyaunsh Divatia of Janus Henderson was even more direct: "Alphabet has everything you want, so investors are comfortable holding it because it has so many ways to win in AI."
But the stock is no longer cheap
Alphabet trades at 28 times earnings, versus a 10-year average below 21 times. That is its highest level since 2008.
Analysts have lifted 2026 net-income estimates by 19% over the past month and raised 2027 estimates by more than 7%. The rally is therefore not only a multiple expansion story; earnings expectations have moved up too. That double lift is what makes a 160% gain easier to defend.
Still, the consensus price target is around $422, only 5.4% above the current share price. Wall Street is signaling that much of the heat may already be in the stock.
O'Neill also conceded that although investors are no longer getting Alphabet at a bargain price, it is still possible for the company to hold, or even expand, its valuation multiple. In other words: expensive, but not necessarily finished.
The risks are equally clear. Gemini could be overtaken by rivals at any time; NIMBY resistance around data centers is beginning to slow infrastructure expansion; and the stock is already trading at its richest level since 2008.
The shift that matters
Alphabet's move from AI afterthought to one of the hottest candidates for the AI throne is really a repricing of the AI value chain.
Nvidia's story is still about selling the most expensive picks and shovels. But investors are starting to ask what happens to that cyclical business if AI spending slows.
Alphabet's story is search, cloud, YouTube, Waymo, Gemini and TPU. If one leg weakens, five others are still moving. AI cash flow can feed the advertising business, cloud backlog gives the company years of visibility, and TPU may open a second growth curve.
Berkshire Hathaway's recent purchase is another quiet vote of confidence.
The next thing to watch is when Sundar Pichai truly puts TPU on the shelf for third-party customers. That would mark Alphabet's turn from a model company into an AI infrastructure company, and it would loosen Nvidia's grip a little.
Sources: CocoLoop, AI wins have Alphabet poised to become world's biggest company (Fortune); Alphabet's 160% rally in a year reflects value of owning 'most of the stack' in AI (CNBC)