Apple became the second company to break the $5 trillion valuation mark, benefiting from investors fleeing AI and semiconductor stocks amid a broader tech selloff.
The iPhone maker’s shares hit a trading high of $342.89 on Tuesday, giving it a total market capitalization of $5.04 trillion (£3.78 trillion), before falling 0.8% to $339.68 (nearly $4.99 trillion).
Apple earlier this month became the world’s most valuable company, overtaking semiconductor giant Nvidia, which has held the top spot since June 2025 and became the first company to break the $5 trillion threshold last October.
The rise in U.S. consumer electronics companies’ stock prices has been driven as much by strong demand for their products as by their decision to retreat from the AI spending race that sucks cash flow from big technology companies.
The company’s new valuation marks a record high amid a sell-off in AI stocks around the world due to growing concerns about AI companies financing data center expansions.
When Wall Street opened on Tuesday, U.S. semiconductor stocks extended recent losses, with Intel, Advanced Micro Devices, SanDisk, Western Digital and Seagate Technology all down more than 4%.
The Nasdaq 100 index of major tech stocks fell as much as 1.8% at one point. This represents a decline of more than 10% since its all-time high in early June, the technical definition of a market correction.
Meanwhile, the South Korean stock market fell to its lowest level since mid-April, with semiconductor companies SK Hynix and Samsung Electronics dropping more than 10%.
Analysts blamed the selloff on renewed concerns about AI investment spending and competition from cheaper Chinese companies, following a report in the Information that China has begun mass production of domestic deep ultraviolet (DUV) chip-making tools.
Investors may also be growing concerned about the so-called circular financing, which is central to the AI industry and involves artificial intelligence companies funding each other.
They were also surprised that Google announced last week that it would further increase capital spending this year to $205 billion to fund its AI plans, while burning through $5.9 billion in the three months to the end of June, reporting negative free cash flow for the first time in its history.
Apple has been somewhat protected by being behind the curve in AI. Having difficulty developing an in-house model, the company instead relied on Google technology to power new services such as the revamped Siri. This allowed it to avoid the high infrastructure costs that big tech investors were wary of.
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Apple’s decision to keep iPhone prices the same when it announced price hikes for MacBooks and iPads last month also boosted demand, analysts said, as buyers snapped up the company’s flagship devices ahead of expected price hikes later this year.
To support demand, Apple on Tuesday also launched a device leasing program in the US through payments company Klarna. With this program, monthly payments start at $17.99 for an iPhone, $11.99 for an Apple Watch or iPad, and $24.99 for a Mac.
“Apple has resisted the AI spending race by betting that customer experience, not infrastructure investment, will ultimately determine the winner,” said Dipanjan Chatterjee, vice president and principal analyst at Forrester. “The new lease program is a smart move. It won’t lower iPhone prices, but it will change consumers’ perception of cost by replacing sticker shock with predictable monthly payments.”
Including session gains, Apple’s stock price has risen 24% so far this year, far outpacing the other six stocks in the Magnificent Seven cohort of U.S. technology stocks.
Apple is scheduled to report its third-quarter results after the market closes on Thursday, and analysts expect sales for the period to rise more than 15% from a year ago.
Reuters contributed to this report
