<p><strong>Apple</strong> has a long history with the market-cap crown. In August 2018, the iPhone maker became the first publicly traded U.S. company to reach a market cap of $1 trillion. The company added to its resume, becoming the first to reach $2 trillion and $3 trillion in August 2020 and January 2022, respectively. However, the advent of the artificial intelligence (AI) revolution sparked a surge in <strong>Nvidia</strong> <span class="ticker-mention inline-flex items-center font-bold">(NVDA <span class="ml-1 text-red-900">3.06%</span>)</span> stock, which became the first to reach $4 trillion in July 2025 and $5 trillion in October 2025.</p><p></p><p>Apple languished for much of last year, as tariff-related fears and persistent inflation weighed on investor sentiment. However, iPhone sales -- the backbone of its business -- continued to trudge higher. As a result, Apple has gained 20% thus far in 2026, doubling the 10% rise of the <strong>S&amp;P 500</strong>.</p><p></p><p>I predict the iPhone maker will soon overtake Nvidia to once again wear the crown as the world's most valuable company. Here's why.</p>

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<img alt="The Apple logo superimposed over an image of a hand holding an iPhone." width="880" height="587" src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2Nkbi5jb250ZW50LmZvb2xjZG4uY29tL2ltYWdlcy8xdW1uOXFlaC9wcm9kdWN0aW9uLzM5ODNlNDE2YjkxNTk4ZDFiNzE1MTgyNDlmODFhNGRhNTU1OTBhYTMtMTIwMHg4MDAucG5nP3c9MTIwMCZoPTgwMCZxPTc1JmF1dG89Zm9ybWF0Jnc9Mzg0MA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2Nkbi5jb250ZW50LmZvb2xjZG4uY29tL2ltYWdlcy8xdW1uOXFlaC9wcm9kdWN0aW9uLzM5ODNlNDE2YjkxNTk4ZDFiNzE1MTgyNDlmODFhNGRhNTU1OTBhYTMtMTIwMHg4MDAucG5nP3c9MTIwMCZoPTgwMCZxPTc1JmF1dG89Zm9ybWF0Jnc9Mzg0MA"/>
<p style="color: #666">Image source: The Motley Fool.</p>
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</div><p></p><h2 id="the-ai-wildcard">The AI wildcard</h2><p></p><p>The persistent adoption of AI has strained the availability of flash memory and storage chips. Specifically, significant demand for dynamic random-access memory (DRAM) and NAND flash memory chips has far outstripped supply, sending prices for these processors soaring. The impact has gone beyond AI, reaching into the smartphone industry.</p><div><div id="foolcom_sidebar_top_mobile_container"><div><div><div></div><div></div><div></div></div></div><div></div></div></div><p></p><p>China is feeling the heat, as smartphone shipments fell 4.3% year over year, marking the fifth consecutive quarter of declines, according to a report by global market intelligence firm IDC Global. The report noted that &#34;Rising memory and component costs pushed most Android vendors to raise prices, which cooled upgrade demand.&#34;</p><p></p><p>Customers in China, faced with higher prices for bargain smartphones, opted to upgrade to iPhones, as sales grew 24% year over year, the highest growth rate among all vendors in China, and one of only two to generate growth.</p><div><div id="in_line_article_pitch_container"><div><div><div><div></div></div><div><div></div><div></div><div></div></div></div></div><div></div></div></div><p></p><p>Just this week, Chinese regulators approved Apple Intelligence for deployment on iPhones in the country, marking the end of a two-year licensing process. The company joined forces with <strong>Alibaba</strong> and <strong>Baidu</strong>, part of China's requirement that foreign companies collaborate with local partners. This could attract more users to Apple's platform.</p><section><div><div><div><small><div>Expand</div></small></div><div><img alt="Apple Stock Quote" width="64" height="64" src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vYXJ0L2NvbXBhbnlsb2dvcy9tYXJrL0FBUEwucG5nJnc9MTI4?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vYXJ0L2NvbXBhbnlsb2dvcy9tYXJrL0FBUEwucG5nJnc9MTI4"/></div><div><h2>NASDAQ: AAPL</h2><div>Apple</div></div></div><div><div><div>Today's Change</div><div>(0.85%) $2.80</div><div>Current Price</div><div>$330.30</div></div><div></div></div></div><div><div></div><div><h3>Key Data Points</h3><div><div>Market Cap</div><div><span class="inline-flex items-center gap-1">$4.8T<span class="inline-flex shrink-0 align-middle"><span></span><span id="_R_13ai5tminr5uamivb_" class="sr-only">Market cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.</span></span></span></div><div>Day's Range</div><div>$326.85 - $331.40</div><div>52wk Range</div><div>$201.50 - $331.40</div><div>Volume</div><div>973K</div><div>Avg Vol</div><div>54.5M</div><div>Gross Margin</div><div>47.86%</div><div>Dividend Yield</div><div>0.32%</div></div></div></div></section><p></p><h2 id="a-winning-strategy">A winning strategy</h2><p></p><p>The company has long used its supply chain acumen to its advantage over the competition, and this instance is no different. The company has resisted price increases on its iPhones -- despite higher input costs -- thereby stealing market share from rivals, who were forced to raise prices.</p><p></p><p>China has historically accounted for 18% of Apple's sales. By delaying price increases as long as possible, Apple is gaining market share, resulting in a larger installed base for its services, apps, and accessories. Moreover, iPhone users are more likely to adopt other Apple products, in a winning strategy for the company.</p><p></p><p>Investor sentiment continues to weigh on Nvidia as concerns linger. Any suggestion that AI adoption is slowing could be devastating for the chipmaker -- despite the company's record-breaking results. As an Nvidia shareholder, I have no plans to sell, as the long-term future looks bright.</p><p></p><p>That said, I suspect strong sales in China and the dawn of Apple Intelligence are the catalysts that could help the iPhone maker overtake Nvidia's market cap to recapture the crown.</p><div id="article_pitch_container"><div><div><div></div><div></div><div></div><div></div><div></div><div></div><div></div></div></div><div></div></div><div id="promobox_container"><div><div><div></div><div></div><div></div><div></div></div></div><div></div></div>

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<p>An analyst predicts Apple will soon surpass Nvidia's $5 trillion market cap to become the world's most valuable company. This shift is driven by strong iPhone sales in China, where rising component costs forced rivals to raise prices while Apple maintained them, gaining market share. Additionally, the recent approval of Apple Intelligence in China and a 20% stock gain in 2026 support this outlook, despite ongoing investor concerns about AI adoption slowing for Nvidia.</p>

- Apple has a rich history of market capitalization milestones, having reached $1 trillion in 2018 and $3 trillion by January 2022, but was recently surpassed by Nvidia, which hit $5 trillion in October 2025.  
- Despite challenges like tariffs and inflation, Apple's iPhone sales grew by 24% in China, aided by the approval of Apple Intelligence, which is anticipated to boost its user base further.  
- The company's strategy of avoiding price increases on iPhones while leveraging its supply chain advantages may allow it to regain its status as the world's most valuable company.

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Prediction: Apple Will Soon Surpass Nvidia's $5 Trillion Market Cap to Become the World's Most Valuable Company. The Reason Is Hiding in Plain Sight.