Move over, Apple. Google parent Alphabet now most valuable company.

Apple has been the most valuable company in the world four years running, but that title just got passed to Google's Alphabet.

Pascal Rossignol/Reuters/File
Letters spell the word "Alphabet" as they are seen on a computer screen with a Google search page (August 11, 2015).

It was a tale of two companies.

Alphabet, Google’s parent company, and Apple have been locked in a contest for the most valuable company in the world for the past few years.

The iPhone maker held the top spot for the past four years after taking the title from Exxon Mobil in 2012. Apple was valued at $760 billion in early 2015.

But the two companies switched places when Google posted its fourth-quarter earnings from 2015. Alphabet’s market cap is now approximately $547.1 billion compared to Apple’s $529.3 billion.

Alphabet’s explosive growth has been driven primarily by growth in advertising and mobile search options, as well as its ownership of YouTube. YouTube says that the number of people per day who watch videos on the site has increased by 40 percent since March 2014.

"Our very strong revenue growth in Q4 reflects the vibrancy of our business, driven by mobile search as well as YouTube and programmatic advertising, all areas in which we've been investing for many years," Alphabet CFO Ruth Porat said in a press release.

Google also saw the share of people who use Gmail cross the one-billion mark in the fourth quarter of last year, according to CEO Sundar Pichai. Advertising revenue at YouTube also grew during the year, by 17 percent.  

In October 2015, Google established Alphabet as its parent company and separated its riskier ventures, like self-driving cars and the Project Loon internet balloon system, from its more profitable suite of products like YouTube.

That move seems to have paid off. The operating costs for Alphabet’s “Other Bets” increased from approximately $1.9 billion to around $3.6 billion for the twelve months ending in December. Its revenue, however, only increased from $327,000 to $448,000. The segment revenues for Google, on the other hand, increased from $65,674 to $74,541.  

The last time Google overtook Apple as the most valuable company in the world was in 2010. Until mid-2015, Apple’s position of dominance was relatively secure thanks to its ability to consistently churn out innovative products, like each new iteration of the iPhone.

But Apple has relied on the core product that drives the bulk of its revenue for so long that iPhone sales are beginning to dip. Morgan Stanley now projects a six-percent decline in iPhone sales in 2016, and other banks have made similar assessments. Apple stocks have also been on the decline since the summer.

But while Apple may no longer hold the number one spot, it is still ahead of Microsoft (valued at $425.7 billion), Facebook ($326.2 billion), and Exxon Mobil ($310.1 billion). And while iPhone sales are showing signs of slowing down domestically, abroad they’re starting to heat up, particularly in India. Although the iPhone market is more mature in China, demand there is expected to remain relatively high, according to the Morgan Stanley report.  

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to