Google's now bigger than Apple, despite having a third of the sales
Google parent Alphabet Inc is now the world's most valuable company, stealing the crown from Silicon Valley rival Apple.
Alphabet moved ahead after reporting higher profit and sales fuelled by a booming advertising business that's supporting ambitious new projects.
Alphabet's shares jumped 4.2pc as the market opened yesterday, pushing its market capitalisation to $542.2bn.
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.
Apple first passed oil giant Exxon Mobil to become the world's most valuable company in 2011.
By changing its name and structure last year, Alphabet chief executive officer Larry Page has put the focus on the company's main web business.
And there's also more insight into investments in new areas such as artificial intelligence, self-driving cars, health technology and fast internet access.
Even though Apple has also been building expertise in cars and artificial intelligence, the secretive company has kept much of that under wraps.
With iPhone sales slowing and China's growth engine sputtering, Apple is on pace to post its first revenue decline in 15 years. Alphabet sales are estimated to climb 16pc this year.
"Alphabet's core business looks very healthy," Josh Olson, an analyst at Edward Jones & Co, said. "That's going to build investors' confidence about the other bets they've been making." The shares of California-based Alphabet rose to $784.77, an all-time high, before slipping slightly to $777.01 at 9.36am in New York yesterday.
Apple fell along with most other technology stocks, shedding 0.6pc each to $95.83. That gives the iPhone maker a market value of $530.6bn.
Alphabet's fourth-quarter revenue, excluding sales passed on to partners, rose 19pc to $17.3bn. That exceeded analysts' average projection for $16.9bn, according to data compiled by Bloomberg.
Profit, before certain items, was $8.67 a share, beating the prediction for $8.08.
The health of Google's main business and investor confidence in the company's ability to innovate has helped to more than double the stock price since 2012.
While Apple generates more than triple the revenue and profit of Google, investors focus more on future prospects than past performance.
The Apple and Alphabet valuations both reflect the premium investors put on US technology companies.
Five of the nine most valuable companies in the world are from the industry, including Microsoft, Facebook and Amazon.com. (Bloomberg)