The AI trade has a new king

Dynasties don’t last forever. Just ask the Patriots. Or as of today, Nvidia.

Roughly a year after surpassing Microsoft to become the world’s most valuable company, Nvidia has lost its crown. Apple briefly claimed the top spot today before Nvidia snagged it back in the final moments of the trading session, but its temporary claim to the top spot capped off a remarkable run that’s lifted its shares 22.76% this year—the best performance among the Magnificent Seven.

As we discussed on Monday, investors have plenty of reasons to be optimistic: Apple is gearing up to launch its long-awaited foldable iPhone this September, and yesterday it cleared another hurdle in China after being added to the country’s list of approved generative AI providers. But perhaps Apple’s biggest advantage is what it isn’t doing: spending tens of billions of dollars in the AI arms race.

That was enough for HSBC to upgrade Apple from Hold to Buy today. The bank noted that Apple’s expected to invest just 2.5% of its estimated 2026 sales on AI, compared with 39% on average from the major hyperscalers. Instead, Apple is focused on rolling out a smarter Siri and new AI features alongside its upcoming hardware lineup, which HSBC says could spark a major iPhone upgrade cycle.

But not everyone is convinced. Just over 60% of analysts rate Apple a Buy—well below the roughly 90% who remain bullish on Microsoft, Amazon, Meta, and Nvidia.

Nvidia’s nosedive

Nvidia, on the other hand, has risen just 8.75% this year as investors question how long the industry’s massive infrastructure spending spree can continue. IBM recently blamed weaker-than-expected results on customers shifting budgets toward memory produced by companies like Micron and Sandisk, which have gained 197.45% and 470.74% this year, respectively. Now, Nvidia appears to be feeling the effects of the same rotation.

The pressure mounted today after Chinese startup Moonshot AI unveiled what it called the world’s largest open-source AI model, claiming it outperformed OpenAI’s GPT-5.5 and Anthropic’s Claude Opus 4.8 on several coding and agent benchmarks. The announcement dragged AI stocks lower, and Nvidia fell 2.21% along with them.

Apple, meanwhile, remained largely flat for the day. Investors increasingly see it as a company that profits from AI rather than spends on it, highlighting how the AI trade is evolving from chips and infrastructure to the consumer products built on top of them. Now investors will just have to see if Apple can make a Siri that doesn’t accidentally FaceTime your ex instead of your mom.—SY