On December 9, Bloomberg reported that earlier this year, Apple was repeatedly criticized for its lack of an AI strategy, and its stock price plummeted. However, as AI concept stocks receive more and more scrutiny, this "hesitancy" is turning from a weakness into an advantage, and has been reflected in the stock market.

Apple Intelligence bounced

In the first six months of 2025, Apple ranked second to last among the "Seven Big Tech Companies" in the U.S. stock market, with its stock price falling by 18% as of the end of June. But since then, the situation has reversed, with Apple stock soaring 35%, while AI darlings like Meta and Microsoft have turned negative, and even Nvidia has underperformed. During the same period, the S&P 500 index rose by 10%, and the Nasdaq 100 index, which has a relatively high proportion of technology stocks, rose by 13%.

"It's amazing that Apple can stay calm and control spending when all its peers are going in the opposite direction," said John Barr, portfolio manager of the Needham Aggressive Growth Fund, which owns Apple shares.

Apple stock outperforms S&P 500, Nvidia

As a result, Apple's market value reached US$4.1 trillion, ranking second in the S&P 500 Index, not only surpassing Microsoft, but also approaching Nvidia. The shift reflects the market's scrutiny of tech giants investing hundreds of billions of dollars in developing AI and signals Apple's readiness to ultimately benefit when the technology matures and becomes widespread.

"Although Apple will inevitably integrate more AI technology into mobile phones in the future, they have successfully avoided this costly AI arms race." said Bill Stone, chief investment officer of Glenview Trust Company, which holds Apple stocks.

Of course, this surge has also made Apple stock more expensive than it has been in a long time. The stock currently trades at a price-to-earnings ratio of 33 times expected earnings over the next 12 months. This valuation level has only been reached a few times in the past 15 years, peaking at 35 times in September 2020. During this period, the stock has averaged less than 19 times earnings.

Today, Apple is the second most expensive stock on the Bloomberg "Big Seven" index, behind Tesla's 203 times forward price-to-earnings ratio.