Apple’s status as the world’s most valuable company is being threatened by Microsoft. As Ian King writes, it’s quite a comeback.
The fearful battering handed out to the FAANG stocks – Facebook, Apple, Amazon, Netflix and Google’s owner Alphabet – since the late summer has had a most unexpected side effect.
For it has led to Apple, whose share price has lost a quarter of its value since 3 October, losing its title as the world’s most expensive company.
Moreover, it has not been overtaken this time by Amazon, which briefly beat Apple in September to hold that particular accolade.
Instead, it has been surpassed by Microsoft, a business that for many years has been largely overlooked by investors amid the excitement surrounding the FAANGs.
Microsoft’s stock market valuation on Monday briefly hit $812.93bn (£633.85bn), against just $812.60bn (£633.61bn) for Apple, with Amazon trailing on $773bn (£602bn). Apple was back on top by the time Wall Street closed on Monday night but, if recent trends continue, Microsoft could well recapture the number one spot again in coming days.
It represents quite a comeback by Microsoft, which was last a more valuable company than Apple as long ago as 2010, while you have to go all the way back to 2003 to find a time when the company co-founded by Bill Gates and Paul Allen – who died last month – was the world’s biggest.
The reversal of fortune is due not just to the drop in Apple’s share price, which reflects concerns over likely sales of iPhones, iPads and Apple Watches during the Christmas period, as well as unease among investors about the extent to which the company may be hit by tariffs on electronic devices, like Apple’s, that are assembled in China.
It also reflects the turnaround achieved by Satya Nadella, who became Microsoft’s chief executive in February 2014, succeeding Steve Ballmer.
The contrast between the two men could not be greater.
Credit: Skynews
