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Apple’s market value stood at $4.88 trillion on Friday, edging past Nvidia’s $4.86 trillion after the latter’s shares fell 3.5%.

The milestone marks Apple’s return to the top for the first time since April last year and reflects a broader shift in investor sentiment. While Nvidia has dominated the artificial intelligence boom by supplying the chips powering ChatGPT and other generative AI systems, investors are beginning to favour companies seen as better positioned to turn AI into long-term profits.

For much of the AI race, Apple was criticised for lagging behind rivals such as Microsoft, Google and Nvidia, largely because it invested less aggressively in building large AI models. That perception has begun to change.

Instead of competing directly in AI infrastructure, Apple is betting on bringing AI features to its vast ecosystem of more than a billion iPhones, iPads and Macs through software, services and hardware upgrades, Reuters reported.

“Apple was seen as a laggard in the AI race because it wasn’t spending to develop models, but now sentiment has changed,” Toni Meadows, head of investment at BRI Wealth Management, told Reuters.

Analysts say Apple’s greatest AI advantage could lie in the enormous amount of personal data stored securely on users’ devices, allowing future versions of Siri to deliver more personalised responses while maintaining the company’s privacy-focused approach.

The market milestone also comes during a pivotal leadership transition at Apple. Chief Executive Tim Cook is expected to hand over the role to longtime hardware executive John Ternus in September after overseeing one of the company’s biggest AI pushes.

Last month, Apple unveiled a major overhaul of Siri, hoping the long-delayed upgrade will narrow the gap with rivals racing to dominate artificial intelligence.

Despite losing the top spot, Nvidia continues to be one of the biggest beneficiaries of the AI boom. Its graphics processors power many of the world’s leading generative AI systems, and analysts say the company could reclaim the crown if market sentiment shifts again.

“I don’t see any meaningful distinction. Nvidia is likely to remain a significant participant in whatever happens going forward,” Benjamin Hall, vice president of alpha research at Segal Marco Advisors, told Reuters.

The AI investment wave is also lifting other semiconductor companies. Memory-chip maker Micron crossed a $1 trillion market value in May, while South Korea’s SK Hynix recently listed on Nasdaq, highlighting how investor interest is expanding beyond the traditional “Magnificent Seven” technology giants.

Apple’s growing importance extends beyond Wall Street. The company has significantly expanded iPhone manufacturing in India in recent years, making its financial performance increasingly relevant to the country’s technology ecosystem. At the same time, future AI-powered iPhone features are expected to shape the experience of millions of Indian users, making Apple’s renewed momentum closely watched by consumers and investors alike.