Jim Cramer Backs Apple’s AI Strategy as Company Hits $5 Trillion Valuation Milestone

Ever the Apple Inc. (AAPL) bull, Jim Cramer is nothing but ecstatic about the firm’s recent fortunes. With a market capitalization of $4.90 trillion when Cramer made his remarks, the firm was the most valuable company in the world once again after losing the place to NVIDIA. Most of the debate surrounding Apple Inc (AAPL) has focused on its AI initiatives. While most big ticket tech firms such as Alphabet and Meta have gone ‘all in’ when it comes to the new technology, the consumer electronics firm has taken a more cautious approach. Yet, its massive user base has also allowed Apple Inc (AAPL) to play a key role in the sector. Cramer has commented on these aspects regularly. He has gone as far as to joke that the firm is a ‘freeloader’ when it comes to AI and defended it from critics of the AI strategy. With Apple Inc (AAPL) now once again the world’s most valuable company, the CNBC TV host relished in the development in his Monday morning remarks.

“Apple the winner, repeatedly. Apple the winner, Apple the winner, Apple the winner. And they’re the ones that all the really so called smart people told us, they didn’t have AI right. Well I guess it was good not to have AI.”

The bulls and bears, when it comes to Apple Inc (AAPL), are also split across AI monetization. While the bulls believe that the firm’s massive user base and strong product launches provide it with plenty of room to support earnings expansion and keep its margins strong through pricing measures, the bears are uncertain whether Apple Inc (AAPL)’s user base can allow it to sufficiently monetize AI initiatives. Cramer is solidly in the bullish camp, as his remarks suggest that he views the firm as an ‘AI safe haven.’ Yet, this same status has led the bears to question valuation multiples as they wonder whether a high forward P/E of 35x can leave any room for error when it comes to delivering on the earnings front.

Apple Inc (AAPL)’s latest earnings report saw the shares dip 6% in aftermarket trading. During the earnings call, another key topic in the debate, i.e., the impact of high component costs, came into focus. Management cited supply constraints to hold back on their optimism for guidance. Apple Inc (AAPL) guided its revenue growth for the current quarter to sit between 9% and 11%, while analysts had estimated 12%. Yet, Cramer remained a bull as he tweeted:

“Apple’s issues are all memory and currency…”

However, he also agreed with the bearish caution about the multiple being too high for any financial weakness and tweeted:

“. . .Apple’s stock has run too much to charge higher.”

During Q4 2025, 169 out of the 1,041 hedge funds part of Insider Monkey’s database had owned Apple Inc (AAPL)’s shares. This figure jumped to 170 out of 1,022 in Q1 2026. The largest stakeholder was Berkshire Hathaway with its $57.8 billion stake while D E Shaw bumped its stake by 29% to sit at $1.7 billion. On the flip side, Ron Baron’s BAMCO Inc. exited its stake.

While we acknowledge the potential of AAPL to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AAPL and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT:

• Jim Cramer Draws the Line on NVIDIA in China: Why National Security Comes First
• Jim Cramer Defends His Dell Stance as Investors Complain About Missing Out

Disclosure: None.

Frequently Asked Questions

What are Apple’s key AI initiatives and how do they differ from competitors?

Apple has taken a more cautious approach to AI compared to competitors like Alphabet and Meta, which have gone ‘all in’ on the technology. Instead, Apple leverages its massive installed user base of over 2 billion active devices to integrate AI features across its ecosystem, from Siri improvements to on-device processing for privacy-focused AI functions. The company focuses on integrating AI seamlessly into its hardware and software rather than making AI the central marketing narrative.

How does Apple’s massive user base factor into its AI monetization strategy?

Apple’s 2+ billion device user base provides a unique advantage for AI monetization through data feedback loops, subscription services, and ecosystem integration. The company can refine AI models through real-world usage while maintaining its strong privacy stance. This massive reach allows Apple to potentially monetize AI through enhanced Siri functionality, predictive text, photography features, and health insights without compromising user privacy – a key differentiator in the current AI landscape.

What does the 35x forward P/E ratio mean for Apple’s valuation amid AI investments?

A forward P/E ratio of 35x means investors are paying $35 for every $1 of expected earnings over the next 12 months. While this is higher than the market average, bulls argue Apple’s massive cash reserve, growing services revenue, and loyal user base justify the premium. Bears contend that without significant AI revenue streams, this valuation leaves little margin for error if earnings growth slows due to competitive pressures or macroeconomic headwinds.