Apple is still trying to find its AI footing. That’s giving Alphabet and Amazon an opportunity to overtake Apple’s valuation.
With a market capitalization of $3 trillion, Apple (AAPL 5.04%) is one of the most valuable publicly traded companies. But the company is lagging behind some of its rivals when it comes to an artificial intelligence strategy, and that’s giving other tech companies the potential to eventually leapfrog Apple’s market cap in the coming years.
While comparing investment opportunities solely based on market cap does paint the entire picture, it’s worth considering how some rival tech giants could outpace Apple as they invest in new opportunities. Here’s why Amazon (AMZN 3.97%) and Alphabet (GOOGL 0.75%) (GOOG 0.82%) could outpace Apple over the next few years.
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Amazon has many irons in the fire
Amazon has a market cap of $2.3 trillion right now, and while the company’s share price may have stumbled lately, I think some investors are missing the big picture, which is that Amazon continues to be the dominant force in several markets.
First, Amazon is the leading cloud computing company with about 30% of the market. Yes, Microsoft has chipped away at its lead over the past few years, but Amazon still holds the No. 1 spot and still benefits from significant sales growth from its Amazon Web Services (AWS).
AWS sales rose by 18%Â in the second quarter of 2025, which beat estimates but was below some of its competitors’ cloud growth. CEO Andy Jassy has assured investors that his company is committed to its AI cloud computing future and is spending an estimated $118 billion to keep pace with rivals.
And then there’s the company’s e-commerce dominance. Amazon captured about 38% of the e-commerce market in the U.S., leaving Walmart and Target with just 6% and 2%, respectively. With more than 200 million Prime members, Amazon has a customer base that’s locked to its platform, and it shows no signs of slowing down.
What’s more, Amazon is now an advertising powerhouse. The company’s ad sales grew 23% in Q2 to $15.7 billion, and it’s the company’s fastest-growing business. This is an important market for Amazon as the U.S. digital advertising segment expands into a $490 billion market by 2029.
When you combine Amazon’s long-term opportunities in AI cloud computing, its e-commerce dominance, and its rapidly expanding advertising business, there’s plenty of room for Amazon to grow larger over the next several years and potentially overtake Apple’s valuation.
Alphabet is making big strides in AI
With its market cap of $2.3 trillion, Alphabet has the chance to overtake Apple over the next three years as the company continues to benefit from its strong position in AI.
Two of the most significant ways it can do this are through the company’s Gemini chatbot and through its Google cloud services. Gemini usage is growing quickly, with the company having an estimated 400 million monthly active users already.
Alphabet does have its work cut out for it as the company transitions its traditional search tools to its AI Mode, which provides conversational responses to queries, but management says it will expand embedding ads within the AI Mode responses. The company is also implementing AI-powered ads for some of its users, with over 2 million advertisers now using the platform, a 50% increase from the same time last year.
And then there’s the growth from Google Cloud. While the company is behind Amazon’s and Microsoft’s market share — Google has 12% of the market — it’s made significant strides over the past few years, and revenue is growing. Google Cloud sales were up 32% in Q2 to $13.6 billion, and it recently doubled the number of customer deals worth $250 million or more.
What’s more, Alphabet’s shares are trading at a price-to-earnings ratio of just 20, below the S&P 500Â index’s average of about 29, Alphabet stock looks like a good value right now.
Both Amazon and Alphabet appear to be taking the appropriate steps to benefit from artificial intelligence and to maintain their dominance in their respective markets. And while there will likely be some growing pains over the next few years as their AI ambitions take shape, their opportunities could propel them ahead of Apple over the next three years.
Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Microsoft, Target, and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
