On Monday, Google’s parent company, Alphabet, became the fourth company to reach a market value of $3 trillion, and every member of this exclusive club has something in common.

All it took was a rather small 4% rise in shares for the tech giant to hit the coveted stock market benchmark. Rather unsurprisingly, the three previous winners of that title—Nvidia, Microsoft, and Apple—are all titans of the tech industry that have been riding the wave of investor interest in AI, as well.

Alphabet stock had a great start to September after a federal judge concluded earlier this month that the tech giant could keep Chrome despite its monopoly in internet search. The judge’s reasoning for that was that generative AI would eventually pose “a meaningful challenge to Google’s market dominance.”

Google is trying to get ahead of that “meaningful challenge” by fusing AI into its search engine and pouring billions into developing its AI offerings, including its own AI chatbot Gemini.

It seems that investment cashed out for the company. As of Monday morning, Google Gemini is now the number one free app on Apple’s App Store, relegating OpenAI’s ChatGPT to number two status and giving the much-needed push to the company’s stock.

The AI hype is inextricably and intricately linked to the significant stock market returns that these tech giants, and many others, have experienced this year. The trillion-dollar question: Is there an AI bubble?

AI hype driving major gains

The best example of AI hype delivering trillions of dollars of financial gain is perhaps Nvidia, the ultimate AI darling of the stock market. Due to its immense market share in AI chips and the meteoric rise it experienced thanks to the technology, the company is largely considered the face of the AI hype.

Earlier this summer, Nvidia made history as the first company to ever hit $4 trillion market valuation.

Apple, considered the least AI-savvy of the four companies to breach the $3 trillion benchmark, was the first company to ever be worth $3 trillion but is still yet to hit $4 trillion. Meanwhile, both Nvidia and Microsoft have outperformed Apple and already reached that milestone. Microsoft’s breach of the $4 trillion benchmark was also thanks to AI.

Late July, Microsoft posted an earnings report that showed stellar revenue for its cloud computing platform Azure. The stock move following the report pushed Microsoft briefly above $4 trillion market value.

Fellow cloud infrastructure provider Oracle also benefited greatly from an AI-demand-driven stock move. Chairman Larry Ellison became the richest man on Earth last week after Oracle stock skyrocketed more than 42% on news that the company expects to collect half a trillion dollars (and potentially billions of dollars more) in the coming quarter on AI deals alone.

Is there a bubble?

All this is great news for tech companies and their financial metrics, but is it substantiated? That question has been plaguing investors for some time now.

According to some experts (and OpenAI CEO Sam Altman), there is indeed an AI bubble.

“Are we in a phase where investors as a whole are overexcited about AI?” Altman said last month in a dinner with journalists, according to The Verge. “My opinion is yes.”

An AI report from MIT fueled those worries further just a few weeks ago. The researchers shared that despite the push to scale AI in the corporate world, fewer than one in ten AI pilot programs have actually generated revenue gains.

AI is currently deployed mostly by larger firms in select fields. But even there, AI adoption is now declining, according to the latest U.S. Census Bureau findings.

If AI is indeed in a bubble, the burst could be catastrophic. So much is riding on the AI wave right now, including the entire U.S. economy.

In a paper published in July, Fed researchers said that if AI demand does not scale proportionally with investment, it can lead to “disastrous consequences,” and compared it to the railroad over-expansion of the 1800s and the economic depression that followed. Also in July, economist Torsten Slok called the AI bubble of today even worse than the 1999 Dot-com bubble.

Analysts have characterized the recent strength in the stock market as an AI rally, but flying under the Magnificent Seven’s radar is Walmart — a company so vast that it literally has its own weatherman.

And as it turns out, the retail juggernaut’s scale and reach are proving to be tremendous assets in the AI race.

That’s because most top AI companies — like OpenAI, Microsoft, Anthropic, or Meta — operate in a primarily virtual space, processing unfathomably complex rivers of information into more digital information. AI-adjacent companies like Nvidia, Intel, and Oracle focus on providing the physical infrastructure upon which the AI machines function. Then there are the companies that are using digital intelligence to deliver physical results through automation and augmented experiences, like Tesla and Amazon.

Walmart, by contrast, has a vast and complicated set of physical challenges to solve as the largest retailer in the US — and the world. Those include everything from cleaning up spills in the dairy aisle to stocking shelves.

“We move billions of items around every month, every year,” Walmart US CEO John Furner said Tuesday at the Fortune Brainstorm Tech conference. He said the company has been developing machine learning tools and other automation projects since around 2015.

Furner said that the company’s AI models and supply chain automation help plan inventory to arrive at the right aisle at the right time, for example. One technique involves creating “digital twins” of each facility to model the movement of merchandise through the system on its way to customers.

Furner also said store associates increasingly have an AI chatbot handy via their handheld devices to help them better set priorities and help customers.

“It’s a combination of people being powered by technology. There’s a lot of judgment to retail and decision-making. And we’re in a very dynamic industry,” he said. “We think this next phase of physical AI in combination with Gen AI is going to be really helpful.”

The company’s head of e-commerce, David Guggina, told the Goldman Sachs Communicopia and Tech conference last week how AI is helping his team run experiments and fulfill orders at an increasingly rapid rate.

Guggina said his team is now able to work at breathtaking speed behind the scenes, too.

“What took a data scientist days or weeks before can now be done in minutes,” he said.

AI also helps ensure that each of the company’s 4,700 stores has the kinds of products best suited to their local markets, slashing delivery times to minutes after a customer places an order.

“We’ve just completed the third inning,” he said by way of the classic baseball game analogy. “So we’re still early with regard to our automation journey in the fulfillment network.”

These digital-to-physical uses of AI are also complemented by a myriad of “micro agents” that handle tasks like tracking local event calendars or monitoring inventory levels.

Walmart, of course, is still fine-tuning its AI approach, and there have been hiccups.

The proliferation of bespoke Walmart-made AI agents eventually started to confuse users, the company told the Wall Street Journal.

The company has rolled many of those micro agents into four “super agents” designed to assist shoppers, merchandisers, programmers, and third-party marketplace sellers.

Still, because Walmart’s 20,000-strong global tech team builds so many of these digital and physical solutions in-house, the company is emerging as an unexpected AI powerhouse.

The company snagged former Instacart exec Daniel Danker in July to accelerate its AI efforts.

It’s also deepening its partnership this month with OpenAI via a new training program for associates and enterprise access to ChatGPT tools for frontline Sam’s Club employees to help operate their warehouse stores more smoothly.

After all, while chatbots might sometimes hallucinate answers, there’s no faking a cold gallon of milk on your doorstep.

The milestone was driven by a revitalization in optimism around artificial intelligence and an antitrust ruling that went in Google’s favor, Reuters reported Monday.

The company’s stock jumped 32% this year, making it the leader among the “Magnificent 7” stocks, the report said. The other six companies are Amazon, Apple, Meta, Microsoft, Nvidia and Tesla. Two of those firms, Apple and Microsoft, have broken the $3 trillion mark, while Nvidia is the world’s most valuable company with a market cap of $4.25 trillion.

Bokeh Capital Partners Chief Investment Officer Kim Forrest said in the report that tech stocks have led the recent rally and “there has been no other [sector] in the past 18 months, maybe even two years that has had such excitement from investors.”

Investor sentiment saw a boost earlier this month when a federal judge permitted Google to retain control of its Chrome browser and Android mobile operating system, a turning point for the company after years of scrutiny into its dominance in the search and mobile fields, according to the report.

Although sharing data as part of the ruling will bolster Google’s advertising business rivals, not having to offload Chrome or Android takes away a crucial concern for investors who view them as vital pieces of Google’s overall business, the report added.

“They still are very dependent on search, but with YouTube, Waymo and other capabilities and products they’re working on, investors are starting to see that possibility that this isn’t just a search company anymore, this is a company that’s moving into a lot of other things,” Stock Trader Network Chief Strategist Dennis Dick said, per the report.

The news came days after Google Cloud CEO Thomas Kurian discussed the company’s AI revenue generation thus far.

“We’ve made billions using AI already,” Kurian said Tuesday (Sept. 9) at the Goldman Sachs Communacopia and Technology Conference in San Francisco.

“Our backlog is now at $106 billion; it is growing faster than our revenue,” he added. “More than 50% of it will convert to revenue over the next two years.”

Google reported revenue of $13.62 billion for its cloud computing unit, up 32% over the prior year.