The tech giant Apple, currently valued at a staggering $3.4 trillion, is struggling to shift its growth into high gear. Despite being the world’s most valuable company, its recent financial performance has been lukewarm, with revenue increasing by a mere 5% year over year to $85.8 billion in the third quarter of fiscal 2024. Analysts predict a modest 9% revenue growth for the year, followed by an 8% increase in the next fiscal year. This slow growth can be attributed to Apple’s massive revenue base and the stagnation of its bread-and-butter smartphone market, which accounts for 52% of its revenue.
On the other hand, Nvidia, currently the third-most valuable company with a market cap of $2.85 trillion, is poised to dethrone Apple in the next decade. The company has been riding the artificial intelligence (AI) wave, with its graphics processing units (GPUs) being deployed for training popular AI models like ChatGPT. Nvidia’s revenue growth has been phenomenal, with a 122% increase in the second quarter of fiscal 2025 to $30 billion.
The company is diversifying into areas beyond AI training, including AI inference applications, which have accounted for over 40% of its data center revenue. The market for AI chips is expected to generate $300 billion in revenue by 2034, growing at an annual rate of 22%. Nvidia reportedly controls 70% to 95% of the AI chip market, leaving little room for rivals.
Moreover, Nvidia is expanding into lucrative markets such as AI enterprise software, where it has started witnessing impressive growth. The AI software market is expected to generate a whopping $1 trillion in revenue by 2032. The company has also established a solid position in the nascent but potentially massive cloud gaming space.
Analysts predict Nvidia’s earnings to increase at a compound annual growth rate (CAGR) of 52% over the next five years, outpacing Apple’s expected CAGR of 11%. With its dominance in fast-growing end markets, Nvidia is likely to outperform Apple’s growth by a significant margin over the next decade, potentially becoming the world’s most valuable company.
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