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Prediction: This AI Company Will Be the Most Valuable in the World by the End of 2025

Source The Motley Fool

There isn't a prize for being the largest company in the world by market cap, but it's a position that many companies envy. Right now, Apple (NASDAQ: AAPL) is the largest, although Nvidia (NASDAQ: NVDA) is right on its tail and may move in and out of first place depending on the market's daily swings. Microsoft (NASDAQ: MSFT) is in third place, but it would need to rise about 16% to take the lead from Apple.

As a result, the race for the title of world's most valuable company by the end of 2025 is likely between just Nvidia and Apple, barring major news from Microsoft that vaults it into the lead. Apple has held the title pretty much since 2011, but can Nvidia take it over by the end of the year?

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Nvidia has seen a massive revenue boom

Apple is by far the leading consumer tech brand, and a large percentage of consumers already have an iPhone. Most iPhone users are also devoted to the Apple ecosystem and may own its AirPods, MacBooks, iPads, and smartwatches. This dominance has made the company the world's largest for a long time.

Nvidia has received much more attention during the past two years with its primary product, the graphics processing unit (GPU), which it invented in 1995. The original purpose of a GPU was for processing video gaming graphics, but other uses were soon discovered.

Because the GPU can process multiple calculations in parallel, it became the choice for any task that required vast amounts of computing power. This expanded its functions into engineering simulations, drug discovery, cryptocurrency mining, and artificial intelligence (AI) model training.

AI training has been a huge theme during the past few years, and with Nvidia's GPUs and software being the best available for the job, the company quickly established dominance in the market. GPU demand has rapidly risen since 2023, as shown by the chipmaker's revenue growth.

NVDA Revenue (TTM) Chart

NVDA revenue (TTM), data by YCharts; TTM = trailing 12 months.

In just two years, the company has gone from about $30 billion in annual revenue to more than $100 billion, and Wall Street analysts still forecast enormous growth during the next two years.

NVDA Revenue Estimates for Current Fiscal Year Chart

NVDA revenue estimates for current fiscal year, data by YCharts.

With more than 50% growth expected in fiscal 2026 (ending January 2026), Nvidia still seems to have plenty of potential.

But what about Apple?

Apple's growth has stagnated

Apple's growth has been nonexistent during the past few years, and its revenue has been little changed during the same frame as covered in the Nvidia charts above.

AAPL Revenue (TTM) Chart

AAPL revenue (TTM), data by YCharts.

Its overall revenue figure is much higher than Nvidia's, but it has shown no growth in earnings per share or revenue in the period. However, during the past three years, Apple's stock has risen 42%. How is this possible?

Investors have been willing to pay more for Apple's earnings, which has caused the valuation to skyrocket. The same trend also happened with Nvidia, but it had considerable underlying growth as well. After the run-up during the past few years, Apple's stock is within shouting distance of the chipmaker's price-to-earnings (P/E) valuation.

NVDA PE Ratio Chart

NVDA PE ratio, data by YCharts.

Nvidia still holds about a 46% premium to Apple's stock from a (P/E) perspective. However, Nvidia earnings per share (EPS) are forecast on average to rise by 50% while Apple's EPS is projected to grow by 22%.

The question for investors is: For two companies producing about the same earnings, should the one growing faster be valued higher than the one growing slower? The answer seems obvious, and as a result, I think faster-growing Nvidia will be the world's most valuable company by the end of the year, as long as analyst projections are close to correct.

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Keithen Drury has positions in Nvidia. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. 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.

Disclaimer: For information purposes only. Past performance is not indicative of future results.

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