Apple's capitalization approaches $4 trillion

Apple shares rose as investors expected AI to revive iPhone sales, helping the company's market capitalization reach $3,860 billion.

Since the beginning of November, Apple shares have increased by 16%, adding $500 billion to its market capitalization. At the close of trading on December 23, each Apple share was up 0.3% to $255.20, bringing the technology company's market capitalization to $3,860 billion.

Apple is ahead of Nvidia and Microsoft in the race to the $4 trillion mark. They were the first American companies to reach the $1 trillion and $3 trillion marks.

Apple's capitalization evolution from 2016 to 2024. Chart: Reuters

Approaching the $4 trillion mark, according to Adam Sarhan, CEO of investment firm 50 Park Investments, will be a test of the company's dominance in the technology sector, cementing Apple's position as a leader and market disruptor.

Investors are excited about artificial intelligence (AI) and expect the technology to create a new supercycle of iPhone upgrades , helping to revive smartphone sales. In early December, Apple began integrating OpenAI’s ChatGPT into its devices, a plan that was announced in June.

In recent years, Apple has been criticized for being slow in the AI ​​race. Other tech giants such as Microsoft, Alphabet, Amazon and Meta Platforms have all been quick to apply AI in their products.

Apple is now forecasting single-digit revenue growth this quarter, a modest number for the holiday season that casts doubt on the iPhone 16's prospects.

Still, data from financial services firm LSEG shows analysts expect iPhone sales to rebound next year. “While near-term iPhone demand remains muted, Apple’s Intelligence features should help improve demand later,” Morgan Stanley analysts said, naming Apple as their top stock to buy for 2025.

Apple now faces the risk of retaliatory tariffs if US President-elect Donald Trump carries out his intention to increase import tariffs on Chinese goods. "However, we believe the company will be granted exemptions for products such as iPhone, Mac and iPad, similar to 2018," Morgan Stanley expects.