Apple reaches $4t market cap as tech stocks slide

Apple Inc. outperformed the broader tech market on February 4, with shares rising 1.8% in New York, compared to a 2.4% decline in the Nasdaq 100 Index.

The stock’s increase pushed Apple’s market capitalization above US$4 trillion, making it the second-largest company globally after Nvidia.

The stock rise follows recent strong quarterly results and an improved forecast, while many software stocks declined amid concerns over AI competition.

Investors have shown caution towards AI-focused software companies, with some analysts noting that Apple’s hardware-centric approach may shield it from the recent AI-driven sell-off.

Apple recently announced a multiyear AI technology deal with Alphabet’s Google, which will support features like Siri.

Market analysts suggest that Apple’s strategy of avoiding an aggressive AI arms race may position it better than some software firms facing increased spending and debt to develop AI infrastructure.

🔗 Source: Bloomberg

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Apple is sidestepping a half-trillion-dollar spending spree

Apple is staying out of an AI spending race, and the totals keep climbing.
Big Tech firms are set to spend more than $562 billion on combined capital expenditures (capex), meaning long-term assets like data centers and chips, in 2026. That is more than double the level from two years earlier 1.
Amazon’s 2026 spending plan tops $146 billion. Alphabet’s budget reaches as high as $185 billion 2.
That wave of investment has lifted the median capital-to-sales ratio, meaning capex as a share of revenue, to above 20%. It is the highest level in more than a decade 1.

Apple’s strategy reshapes who benefits in the AI economy

Apple is using its 2.5 billion active devices to act as a large-scale AI distributor instead of a main model builder 3.
Apple is making Google’s Gemini the base layer for Apple Foundation Models. Apple is leaning on Gemini models plus Google cloud systems for the next generation, while Apple Intelligence runs on Apple devices and Private Cloud Compute (Apple’s system for running some AI requests on Apple-controlled servers with added privacy protections) 4.
The reported pricing suggests Apple holds leverage. Google reportedly pays Apple about $20 billion a year for search placement, while Apple plans to pay Google about $1 billion a year for the AI deal, per Bloomberg. The companies have not confirmed terms 3.
The tie-up gives Google a wide route to users. Analysts say it may also let Google learn what queries people ask, which could help with model training. Details remain unclear 3.