Microsoft Become the World’s most valuable company again

Microsoft Become the World’s most valuable company again

Microsoft has, once again, taken over Apple as the world’s most valuable company, boasting a market cap of $2.46 trillion, thereby ending Apple’s five-year reign.

In a recent market shift, Microsoft surpasses Apple in market cap, becoming the top public company globally. The surge in Microsoft’s stock is attributed to recent AI announcements, while Apple faces concerns over declining iPhone sales, resulting in the two tech giants swapping positions on the Nasdaq.

Apple’s stock has been on a downward trend due to worries about iPhone sales in China and potential weaknesses in iPhone 15 sales. Rating firms downgrading Apple stock have led to a significant $162 billion reduction in Apple’s market capitalization in 2024.

Riding the AI wave for over six months, Microsoft experiences notable stock growth, especially after announcing Copilot for Microsoft 365. Microsoft’s frequent AI feature announcements contribute to its market success.

The rivalry between Microsoft and Apple for the title of the most valuable public company has been ongoing, with Microsoft surpassing Apple’s market cap in 2021, 2020, and 2018 before Apple reclaimed the top position. Google also briefly held Apple’s market cap in 2016.

Microsoft briefly claims the title of the world’s biggest company by market value on Thursday, reaching $2.87 trillion, fueled by excitement about generative AI. However, Apple regains the top spot by the end of the trading day at $2.89 trillion compared to Microsoft’s $2.86 trillion.

Investor enthusiasm for generative AI fuels a rally in Microsoft’s shares, supported by its significant backing of OpenAI, the creator of the popular AI-powered chatbot ChatGPT.

In contrast, Apple is somewhat left out of the AI fervor that propels Microsoft, which serves as OpenAI’s major backer, cloud hosting provider, and pioneer in deploying AI chatbots across various products.

Concerns about weakening iPhone sales in China weigh on Apple’s stock in the early days of 2024, leading to Wall Street analyst downgrades.

The historic rivalry between Apple and Microsoft dates back to the 1980s, marked by legal battles. Apple initially accused Microsoft of copying the “look and feel” of its Macintosh software, losing a copyright lawsuit in the early 1990s.

Driven by the success of the iPhone, Apple’s market value overtook Microsoft in 2010. Although Microsoft briefly surpassed Apple during the Covid-19 pandemic in 2020 and 2021, Apple consistently reclaimed the top spot.

While Apple focuses on AI and the upcoming Vision Pro headset, Microsoft benefits from the industry-wide success of ChatGPT and increased demand for its cloud services and Nvidia processors.

The AI-driven shake-up in the world’s top company rankings extends to AI chipmaker Nvidia, closing in on surpassing Amazon’s market capitalization of $1.6 trillion.

In addition to converging market valuations, Microsoft and Apple are closely matched in enterprise value, taking into account their cash reserves.