NEW YORK, May 8, 2026, 12:06 EDT
Nvidia stayed on top as the most valuable public company in midday trading Friday, with shares up 2.3% at $216.45 for a market cap around $5.30 trillion. Alphabet’s Class A shares edged up 0.2% to $398.85, putting its value at about $4.83 trillion—roughly $467 billion behind Nvidia, but keeping the Google parent firmly in Wall Street’s AI spotlight as it chases the $5 trillion mark.
This contest holds weight: investors have moved past seeing artificial intelligence as just a chip-supply narrative. Alphabet is pushing to prove AI’s value across search, cloud software, and company productivity tools. Nvidia, still the benchmark for the hardware spend that fueled the boom, hasn’t lost its grip.
This week, Japanese outlets zeroed in on the changing landscape. Business Insider Japan—alongside its U.S. sibling—had Alphabet nearly overtaking Nvidia, while Shikiho Online probed if Google’s fresh results signal real profits from generative AI. Nikkei’s NQN, meanwhile, declared Alphabet the standout in the latest Magnificent Seven earnings cycle, though it didn’t ignore the question marks hanging over sustained AI demand.
Alphabet posted first-quarter revenue of $109.9 billion, marking a 22% increase. Google Cloud revenue surged to $20.0 billion, up 63%. Operating income in the cloud division jumped to $6.6 billion—triple last year’s $2.2 billion—offering investors a sharper look at AI-driven profits.
Chief Executive Sundar Pichai said Google Cloud’s main engine now is enterprise AI products—a first for the business. He added that Google has started selling its tensor processing units, or TPUs, straight to select customers. These are the company’s custom AI chips for training and running models, and that move puts Alphabet in more direct competition with Nvidia.
Google isn’t cutting ties with Nvidia just yet. Pichai called Nvidia GPUs a “core part” of Google Cloud’s accelerator lineup, while Google confirmed it will carry Nvidia’s Vera Rubin NVL72 system, in addition to its current Blackwell and Hopper instances. That leaves Alphabet straddling both sides—as a buyer and a competitor. Blog
The numbers land hardest on Amazon and Microsoft, both bigger players in the cloud race. Google Cloud is still holding third place behind Amazon Web Services and Microsoft Azure, according to Reuters, but its 63% revenue jump last quarter pulled far ahead of AWS’s 28% and Microsoft’s 40% for Azure and other cloud services.
The interplay between spending and monetization remains in the spotlight. “It’s about hyperscaler capital spending and early signs of better monetization, particularly at Alphabet,” Stephanie Link, Hightower Advisors’ chief investment strategist, told Reuters. For Jeff Buchbinder, chief equity strategist at LPL Financial, cloud and AI demand fueled what he called a “meaningful acceleration,” convincing investors that the stepped-up spending was paying off. Reuters
It was Nvidia’s day again on Friday, as momentum in the broader market stuck with tech. The S&P 500 and Nasdaq climbed to fresh records, Reuters noted, boosted by Nvidia and a tech-heavy rally after U.S. jobs numbers came in above forecasts, cooling some labor market jitters.
The bullish scenario comes with a hefty price tag. Alphabet is now projecting 2026 capital expenditures between $180 billion and $190 billion, according to Reuters. That capex covers big-ticket items—think data centers, servers, chips. If corporate appetite for AI tapers off, or buyers balk at paying what investors anticipate for AI services, returns on those investments could get squeezed.
Alphabet isn’t feeling much pressure yet from its aging core—Google Services pulled in $89.6 billion, up 16%. The segment got a boost from Google Search and other ads, which climbed 19%, and YouTube ad revenue, up 11%. If search habits or ad rates take a real hit, though, suddenly the cloud division’s role becomes a lot bigger than it is right now.
Alphabet remains behind Nvidia, trailing by close to $500 billion in market cap. Still, the dynamic has shifted. Now, the key question for Wall Street: can Google actually monetize its AI efforts enough to close the gap with the chipmaker at the center of the surge?
