Alphabet Takes Lead in $5 Trillion Market Cap Race

Apple (AAPL) and Alphabet (GOOG)(GOOGL), two of the world's largest companies, are racing to reach a $5 trillion market capitalization milestone. Currently, Nvidia is the only company to have achieved this feat.

Alphabet has a head start with a market value of $4.2 trillion, compared to Apple's $4.4 trillion as of August 12. However, Alphabet's core business is thriving, driven by Google Search revenue growth of 17% year-over-year and 24% overall revenue increase in the quarter.

Apple, on the other hand, faces a major headwind due to rising memory chip prices, which could meaningfully affect its business. Departing CEO Tim Cook warned investors about this issue, stating that it is akin to a '100-year flood.' New CEO John Ternus will have to navigate this component crisis when he takes over in September.

Using operating cash flow as a valuation metric, Alphabet trades at a significant premium to Apple. If Alphabet traded at Apple's premium, it would be the largest company in the world, even surpassing Nvidia.