By Martin Baccardax
With the biggest U.S. tech earnings out of the way, and only Nvidia and Broadcom remaining to report over the next two months, Google parent Alphabet is closing in on the lead as the world's most valuable company for the first time in more than a decade.
Google shares have surged more than 140% over the past year, a pace that's nearly four times the gain they posted over the four years prior, thanks in part to their rock-solid hold on internet search, a hammerlock on online video through YouTube, and a massive cloud business.
Threading all those units together, of course, is Google's recent advances in artificial intelligence, which are now woven deeply into all three divisions and are establishing the company as a broader industry benchmark. That push comes a cost, however, but the $144 billion Google has spent over the past two years on capital expenditures, and the $490 billion it has penciled in for the next two, are starting to pay dividends.
"Investors are likely gaining comfort with the elevated capital expenditure level given that the company's full-stack approach to AI is starting to meaningfully materialize in its results," said William Blair's Ralph Schackart. "The expectation of a significant increase to capital expenditures in 2027 further speaks to growing compute needs and the confidence the company has in its AI products."
Google shares now trade with a market value of around $4.64 trillion, having added more than $2.6 trillion over the past year and nearly $900 billion since the start of the year.
That puts the stock on pace to capture the unofficial title of the world's most valuable company, currently held by AI chipmaker Nvidia, over the coming weeks.
Nvidia, with a market value of $4.85 trillion, topped the $5 trillion mark for the first time in October of last year, and reached a peak market valuation of $5.27 trillion on April 27.
The stock's gains over the past six months, however, have been flat, while Google has surged more than 36%, putting it on pace to overtake the AI chipmaker between now and its first quarter earnings update on May 20.
Nvidia's average advance last month was around 0.66% each day, compared to a 1.42% gain for Google. If those paces were to hold throughout the month of May, Nvidia would be just $190 million north of Google's market value when it reports April quarter earnings and gives its updated near-term outlook.
Google last topped the S&P 500 market cap list in February 2016, when it topped previous leader Apple following a stronger than expected fourth quarter earnings report that lifted its total value to $560 billion. It only held that title for two days, however, as Apple regained its lead on Feb. 3
This time around might be different.
Google's cloud backlog jumped by nearly $220 billion over the last quarter, to a record high of $462 billion, around half of which will be realized over the next two years, thanks in part to t he group's entry into the chip sales market.
"Based on backlog on the books, we expect significant increases in Street Cloud revenue growth estimates," said Bank of America's Justin Post. "A portion of the quarter-on-quarter growth represented contracted TPU sales to external customers, a new, potentially large, and profitable business for Google."
The recent quarter update "reinforces our view that Google is a top AI play, with increasing search usage, improving ad targeting, durable cloud advantages, and growing subscription revenue from Gemini," he added. "We think AI tailwinds for search are still in early stages and future LLM improvements will drive durable growth."
Nvidia isn't done yet, however. Its new Vera Rubin chips are likely to start shipping in the second half of this year, adding more heft to the group's expected outlook for 77% revenue growth over the April quarter.
"Additionally, management is expecting Data Center revenue to grow sequentially throughout the current calendar year, and exceeding their previous $500 billion guidance for Blackwell and Rubin that they had outlined," said D.A. Davidson analyst Gil Luria.
"Further, while there have been notable concerns throughout the supply chain about shortages in various components, Nvidia noted they believe they have the necessary inventory and supply commitments in order for them to address future demand that extends into next calendar year."
We'll know a lot more in about three weeks' time.
Google shares slipped 0.04% in late Friday trading and were last marked at $381.80 each, with a market value of $4.65 trillion. Nvidia, meanwhile, edged 0.2% higher to $199.99 each, pegging its market cap at just over $4.86 trillion.
Write to Martin Baccardax at martin.baccardax@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
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May 01, 2026 14:04 ET (18:04 GMT)
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