In August 2018, Apple became the first company to reach a $1 trillion market capitalization. Today, just four other companies also have valuations above that level: Microsoft, Saudi Aramco, Alphabet, and Amazon.
These industry leaders exist in rarified air and are at the top of their respective service categories, but the trillion-dollar club will almost certainly become less exclusive in the coming years. If you want to know which businesses could be next in line to cross the $1 trillion mark, read on for a look at three companies that have a very good chance of pulling it off by 2027.
Image source: Getty Images.
1. Nvidia
Nvidia (NVDA 3.40%) is the world's leading provider of high-performance graphics processing units (GPUs). Not only are these processors used to create and run high-end video games and visual applications, but they've also become increasingly central components for cloud computing and artificial intelligence (AI) applications. It's the AI connection, in particular, that has helped power incredible gains for Nvidia's stock recently.
After rallying 106% across this year's trading, Nvidia now has a market capitalization of roughly $776 billion. Given that the AI revolution still appears to be in the very early stages of unfolding, it's likely that the GPU leader is just starting to benefit from an incredibly powerful long-term tailwind. Moving beyond just being a hardware company, the tech player is now evolving to offer AI-as-a-service -- offering access to its AI supercomputer, software libraries, and generative artificial intelligence models as a cloud service.
As a company that's on the cutting edge of high-performance semiconductor designs, Nvidia already enjoys some of the best margins in its industry, and the push into offering AI-focused cloud services stands to make the company significantly more profitable. Based on recent trends, there's a very good chance that Nvidia will be the next company to reach a $1 trillion market cap.
2. Berkshire Hathaway
Led by CEO Warren Buffett and co-chairman Charlie Munger, Berkshire Hathaway (BRK.A 1.88%) (BRK.B 1.88%) stands as the world's most valuable investment conglomerate. Valued at roughly $729 billion, Berkshire Hathaway has built an incredible history of beating the benchmark S&P 500 index, and it currently stands as the world's seventh-largest company. The company's stellar leadership team, portfolio managers, and analysts continue to make the stock a go-to choice for investors seeking relatively low-risk stocks that are capable of delivering market-beating returns.
Based on the holdings disclosed in the company's most recent 13F filing, Berkshire's stock portfolio is currently valued at approximately $336.5 billion. Check out the table below for a look at the company's five largest holdings by weight.
| Company | Percentage of Berkshire Hathaway stock portfolio |
|---|---|
| Apple | 46.44% |
| Bank of America | 9.09% |
| American Express | 7.69% |
| Coca-Cola | 7.63% |
| Chevron | 6.65% |
Data source: WhaleWisdom; data as of May 18.
In addition to stock holdings, Berkshire also houses fully owned subsidiary railway and energy businesses, insurance companies including Geico and Alleghany, and popular consumer-facing brands including See's Candies, Duracell, and Brooks.
Operating earnings for the company's fully owned subsidiaries climbed 13% year over year in the first quarter, and the value of the investment conglomerate's stock holdings climbed as well. Berkshire also closed out its last reported quarter with roughly $130 billion in cash. While the holding company's composition makes it more likely to be a steady grower than an explosive gainer, it has a clear path to reaching a $1 trillion valuation if its core stock holdings and subsidiaries continue to perform well.
3. Meta Platforms
Meta Platforms (META 3.85%) was already a member of the trillion-dollar market cap club, but it lost that status in September 2021 and is currently valued at approximately $627 billion. Faced with investors pivoting away from growth stocks, disruptive changes that Apple made to user data tracking on its mobile platform, and a broader slowdown for the digital advertising market, Meta stock faced a brutal stretch of trading last year. Even after rallying 103% across 2023's trading, the social media giant's share price is still down 36% from its high.
After a challenging period, things seem to be improving for Meta Platforms. Despite headwinds in the digital advertising market, the company managed to grow revenue by 3% year over year in the first quarter, and it's been able to minimize net income declines through a series of sweeping cost-cutting and efficiency initiatives. Even with its business facing some pressures, Meta Platforms remains very profitable, and the company has more than 3 billion daily active users across Facebook, Instagram, WhatsApp, and other platforms.
Like many companies, Meta is making a big bet on artificial intelligence -- and the company's access to valuable data and incredible tech resources give it a good chance of being one of the biggest winners in the space. While AI is now taking the focus in the company's near-term growth initiatives, the tech giant is also positioning metaverse projects as key parts of its long-term growth strategy. If the digital ads market continues to recover and the business scores wins with some of its growth initiatives, there's a very good chance that Meta Platforms will rejoin the trillion-dollar club.
