Alphabet, Google’s parent company is now the world’s most valuable company. It has stolen the crown from Silicon Valley rival Apple Inc.
After reporting higher profit and sales fueled by a booming advertising business that’s supporting ambitious new projects.
Alphabet’s shares rose 1.7 percent, pushing its market capitalization to $531 billion. The Web company had been inching closer to the iPhone maker in recent weeks as investors lost confidence in Apple’s smartphone business and wagered that Alphabet has a clearer path to growth.
The rise in Alphabet’s share price came after its decision to give investors a clearer picture of its businesses. Google renamed itself Alphabet last August to better reflect the array of businesses it controls. Most famous for its core search engine, YouTube and Android mobile operating system, Alphabet also invests in a series of “moon shot” enterprises, betting on new technologies including robot cars, biotechnology, health and high-speed internet fiber networks.
Alphabet’s new ranking is also a milestone for co-founders Page and Sergey Brin, who started the company as students at Stanford University in 1998 as a tool to more easily search the Internet. The duo still controls the company through a preferred stock structure, and are now among the richest people in the world.
Apple and Alphabet’s business models represent opposite approaches to selling technology tools and products. Apple releases a small number of premium-priced products that connect to a slate of services such as iTunes and the App Store, while Alphabet relies on its free services that bring in enough users to let it profit from selling a huge quantity of advertising. The two companies had a cooperative relationship for many years, and former Google CEO Eric Schmidt sat on Apple’s board. The alliance turned into a rivalry after Google released the smartphone software Android, which Apple co-founder Steve Jobs said copied Apple’s designs, leading to multi billion-dollar patent lawsuits around the world.