Google parent Alphabet surpasses $2 trillion market cap

Alphabet's market capitalization surpassed $2 trillion on Monday, having doubled its value during the pandemic.

Why it matters: The Google parent company was valued at $1 trillion in January 2020. Its business has been buoyed by the migration of companies to digital operations in the past two years.

Details: Google makes most of its revenue from its digital ads business and cloud storage.

• YouTube brought in $7 billion in revenue last quarter, far more than Snapchat, Twitter, Pinterest and LinkedIn combined.
• The news comes two weeks after Alphabet reported third-quarter earnings that beat investor estimates.

Yes, but: Market cap is a metric that's built around market sentiment, not business fundamentals, which means it's vulnerable to big swings.

The big picture: Alphabet becomes the third U.S. company to surpass a $2 trillion market cap following Apple in 2020 and Microsoft earlier this year.

• Amazon, which is currently valued at roughly $1.7 trillion, was racing Google to become the third $2 trillion company. Facebook hit the $1 trillion mark earlier this year.
• Tesla surpassed $1 trillion in value for the first time last month following an alleged deal to sell 100,000 vehicles to Hertz.