Alphabet Hits $4 Trln as Gemini AI Strategy Powers Market Rally

Alphabet briefly crossed a $4 trln market valuation on December 12, Reuters reports. Renewed confidence in the Google parent’s artificial intelligence strategy propelled the stock to record levels.

Shares in Alphabet rose as much as 1.7% to an all-time high before paring gains. The surge followed signs that the company’s AI efforts are gaining traction, including a multi-year agreement under which Apple’s next generation of AI models will be built on Google’s Gemini platform.

Alphabet has also benefited from wider adoption of Gemini across the tech industry. Samsung Electronics plans to expand the number of devices using Gemini-powered AI features this year.

The milestone comes after Alphabet overtook Apple in market capitalisation last week for the first time since 2019, becoming the world’s second most valuable listed company. Its shares have risen about 65% in 2025, outperforming its peers among Wall Street’s so-called Magnificent Seven.

Cloud growth reshapes investor outlook

Investor sentiment has shifted as Alphabet eased concerns that it had lost its early AI lead. Its cloud business has emerged as a major growth driver, supported by strong demand for AI services and a rare investment from Warren Buffett’s Berkshire Hathaway.

The latest Gemini 3 model has received positive reviews, increasing pressure on rivals after mixed reactions to OpenAI’s GPT-5. Google Cloud revenue jumped 34% in the third quarter, while its backlog of unrecognised contracts climbed to $155 bn.

Alphabet has also accelerated growth by offering its in-house AI chips to external customers. Rising demand has prompted talks with major tech firms over large-scale purchases for data centres later this decade.

Meanwhile, Alphabet’s core advertising business has remained resilient despite economic uncertainty and intense competition. The stock has also gained support from a U.S. court ruling last year that allowed the company to retain control of its Chrome browser and Android operating system.

Alphabet is the fourth company to reach the $4 trln threshold, following Nvidia, Microsoft and Apple.