The S&P 500 (^GSPC 1.26%) is home to 500 companies from 11 different sectors of the economy, making it the most diversified of the major U.S. stock market indexes.
But the S&P is weighted by market capitalization, so the largest companies have a greater influence over its performance than the smallest. As of this writing, the following five companies have a combined market cap of $14.9 trillion, representing 28.8% of the entire value of the index:
- Apple (AAPL -0.20%), $3.8 trillion.
- Nvidia (NVDA 4.45%), $3.3 trillion.
- Microsoft (MSFT 1.14%), $3.2 trillion.
- Alphabet (GOOG 1.31%) (GOOGL 1.25%), $2.3 trillion.
- Amazon (AMZN 1.80%), $2.3 trillion.
The S&P 500 delivered a return of 25% during 2024, whereas the S&P 500 Equal Weight index, which assigns the same weighting to every stock regardless of its market cap, was up by just 10%. The difference can be partly explained by the average gain of 61% in the preceding five stocks.
A lot of the value those five companies created in 2024 came from their efforts in the artificial intelligence (AI) space. They are forecast to spend hundreds of billions of dollars combined this year in their quest for AI supremacy. If it pays off, they could become even more influential over the S&P 500.
1. Apple: 7.6% of the S&P 500
Apple recently launched its Apple Intelligence software for users of the latest iPhones, iPads, and Mac computers. It includes a suite of new AI-powered writing tools that can summarize emails and texts and instantly generate replies on command. Apple Intelligence can also prioritize users' notifications after learning their preferences.
Even the Siri voice assistant got an upgrade thanks to an integration with OpenAI's ChatGPT.
Apple Intelligence makes use of the company's latest chips -- the A18 Pro for the iPhone, and the M3 and M4 for iPads and Macs -- which were specifically designed for processing AI workloads on-device. This hardware, and the future generations that will follow, paves the way for Apple to continue pushing the boundaries of the AI revolution with new features.
There are more than 2.2 billion Apple devices worldwide, so this company could eventually become the biggest distributor of AI to consumers, bar none.
2. Nvidia: 6.6% of the S&P 500
Nvidia CEO Jensen Huang delivered the first AI supercomputer to OpenAI in 2016. Now, it's the leading supplier of graphics processors (GPUs) for developing AI, and most tech giants are clamoring to put them in their data centers.
Nvidia just started shipping its new Blackwell GB200 GPUs, which offer a substantial leap in performance over its previous generations. The Blackwell-based GB200 NVL72 system, for example, can perform AI inference at up to 30 times the speed of the equivalent H100 system. That gives developers the computing power they need to deploy the largest AI models to date.
Demand is significantly outstripping supply for Blackwell chips, and they're likely to be the dominant driver of Nvidia's sales growth. The company is on track to generate a record $128.6 billion in total revenue during fiscal 2025, which wraps up at the end of this month, followed by almost $200 billion in fiscal 2026.
Despite an 800% gain over the past two years, Nvidia stock might still be cheap, so it could become an even larger piece of the S&P 500 this year and beyond.
3. Microsoft: 6.3% of the S&P 500
Microsoft rocked the tech sector at the start of 2023, when it announced plans to invest $10 billion in OpenAI. It has since used the startup's technology to launch its own AI virtual assistant called Copilot, which is now embedded in its flagship software products, including Windows, Edge, and Bing.
Copilot can also be added to the 365 productivity suite for an extra monthly subscription fee. It allows users to instantly create text and image content in Word and PowerPoint, which can speed up their workflows. Organizations around the world pay for 365 for more than 400 million of their employees, so even if only a fraction of them add Copilot, it could become a big source of recurring revenue.
The OpenAI partnership also helped Microsoft launch a portfolio of AI services on its Azure cloud platform. Azure AI has become a go-to destination for developers seeking state-of-the-art data center computing infrastructure and ready-made large language models (LLMs) such as OpenAI's latest o1 series to build their own AI software.
Microsoft allocated $55.7 billion to capital expenditures during its fiscal 2024, which ended June 30, and most of that figure was related to AI data centers and chips. It had already spent a further $20 billion during its fiscal 2025 first quarter, ended Sept. 30, so it's on track to invest a record amount in its AI ambitions during the current year.
4. Alphabet: 4.1% of the S&P 500
Alphabet is the parent company of Google, which has a 90% market share in the internet search business. AI chatbots such as ChatGPT are transforming the way people access information online, which is threatening traditional search engines like Google. To protect its dominance, Alphabet launched its own family of AI models, called Gemini, along with a chatbot with the same name, but it's also using them to change how Google Search responds to queries.
In the past, people would enter a query into Google Search and it would produce a list of links to third-party websites. Now, an increasing number of queries return a text-based response at the top of the results, which is generated by AI. Alphabet is taking that to the next level with its new AI Overviews feature, which incorporates text, images, and links to third-party websites to provide a more holistic answer to almost any question.
Alphabet says the links within Overviews receive more clicks than if they appeared in traditional search results instead, which is great news since Google Search accounts for most of the conglomerate's total revenue. If Alphabet successfully pulls off this transition, not only will it protect its dominant market share, but it might also create an opportunity to generate record amounts of revenue by selling ad spots to businesses in Overviews.
5. Amazon: 4.1% of the S&P 500
Amazon is the world's largest e-commerce company, and it's integrating AI into the entire customer experience. It offers a virtual shopping assistant called Rufus that can help customers find the most suitable product for their needs. It even uses a tool called Project Private Investigator inside its fulfillment centers, which uses AI and computer vision to identify defective products before they're shipped out to reduce costly returns.
Then there's Amazon Web Services (AWS), the world's largest provider of cloud services. It wants to dominate the three core layers of AI: data center infrastructure, LLMs, and software. To achieve this goal, AWS designed its own chips, its own family of models called Titan, and its own AI virtual assistant called Q.
AWS generated $27.4 billion in total revenue during the third quarter of 2024, which ended Sept. 30. That was a 19% increase from the year-ago period. However, AI revenue within AWS soared by a triple-digit percentage, and Amazon says this business is growing three times faster than the cloud business did at the same stage of its lifecycle.
Amazon allocated around $75 billion to AI capital expenditures during 2024, and it's likely to spend even more in 2025 to cement its leadership position.
