Tech Giants Thrive on AI: Who’s Next to Reach $4 Trillion?

As of the close of trading on Dec. 13, nine companies held market capitalizations exceeding $1 trillion. Here’s how they rank:

• Apple: $3.7 trillion
• Nvidia: $3.3 trillion
• Microsoft: $3.3 trillion
• Amazon: $2.4 trillion
• Alphabet: $2.4 trillion
• Meta Platforms: $1.6 trillion
• Tesla: $1.4 trillion
• Broadcom: $1.1 trillion
• Taiwan Semiconductor Manufacturing: $1 trillion

These companies share a vital link: artificial intelligence (AI). They are actively steering the AI revolution across software, hardware, cloud computing, social media, and e-commerce.

Dan Ives’ Predictions for 2025

Dan Ives, a managing director and senior analyst at Wedbush Securities, recently shared his top predictions for the tech industry through 2025. Ives sees positive momentum for AI bolstering Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT), and Nvidia (NASDAQ: NVDA) into the coveted $4 trillion market cap next year. Let’s examine the AI factors that could propel these tech leaders moving forward.

1. Apple: Quietly Making Moves

Apple’s presence on this list may surprise some. Although the company has been relatively silent about its AI strategies in recent years, it is now stepping up. Apple has introduced its Apple Intelligence software, which integrates ChatGPT into its ecosystem, including the voice assistant, Siri.

During the latest earnings call, CEO Tim Cook stated, “With the introduction of Apple Intelligence, we’re beginning a new era for iPhone.”

Apple’s next major growth phase depends heavily on the launch of the iPhone 16. In its fiscal 2024 fourth-quarter earnings call, Cook noted record iPhone sales across various regions. Although this is promising, analysts believe Apple needs more time to fully embrace AI before seeing a significant stock increase. Ives anticipates a “supercycle” upgrade among iPhone users as economic conditions improve.

Image Source: Getty Images.

2. Microsoft: Cloud Power and AI Integration

With a significant $10 billion investment in ChatGPT creator OpenAI, Microsoft has rapidly woven AI into its operations. The key driver of Microsoft’s growth lies in its cloud computing arm. Despite fierce competition from Amazon, Alphabet, and Oracle, Microsoft exploits AI to enhance opportunities and empower its position in the market.

In its fiscal 2025 first quarter, ending Sept. 30, Microsoft generated $24.1 billion in sales from its cloud segment. Notably, its Azure Cloud platform reported a robust 33% revenue increase, with 12 points attributed to AI services, according to CFO Amy Hood.

This strong growth is critical as Microsoft faces increasing competition. Hood emphasized the ongoing demand, stating, “demand continues to be higher than our available capacity.” This situation likely will further fuel Azure’s expansion in the upcoming year, driven by AI integration.

3. Nvidia: Gaming to Greatness

Nvidia’s place on this list is not surprising either. The company has become synonymous with AI advancements over the past two years. Its graphics processing units (GPUs), data center services, and CUDA software create a comprehensive AI technology framework, solidifying Nvidia as the second most valuable company worldwide and currently tied with Microsoft.

While some may expect a slowdown, Ives believes Nvidia’s ascent will continue unabated into 2025. Recently, the company released the first GPUs crafted using its next-generation Blackwell architecture. Demand is so high that these chips are reportedly sold out for the next year.

Moreover, Ives anticipates over $1 trillion in AI infrastructure investments soon. With clients like Microsoft, Alphabet, Meta Platforms, and Amazon planning to boost AI-related capital expenditures next year, Nvidia is poised to capture significant market share and solidify its leading position.

The Bottom Line

In considering which companies are most likely to breach the $4 trillion valuation, I align with Ives. Nonetheless, I predict that Nvidia will reach this milestone first, followed closely by Apple and Microsoft.

The overall narrative suggests that these major tech players are riding several favorable trends, setting the stage for substantial growth opportunities for future investors.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Adam Spatacco has positions in Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Oracle, Taiwan Semiconductor Manufacturing, and Tesla. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.