Microsoft poised to overtake Apple as most valuable company
William GallagherCredit: Microsoft
As Microsoft stock rises and Apple's falls over analysts expectation of slowing iPhone demand, the two firms are once more within $100 billion of each other — the smallest gap in over two years.
Apple and Microsoft have a long history of competing for the title of the world's most valuable company, although originally that was specifically in the technology category. In 2010, Apple dethroned Microsoft when it hit a market capitalization of $222 billion, and then in 2018 Microsoft briefly regained that top position.
Now those sums seem quaintly low, and the two companies have instead been vying for the title of most valuable company globally, in any category. In August 2020, Apple became the first publicly-traded US company to reach a $2 trillion market cap, and Microsoft became the second one in June 2021.
Later in October 2021, Microsoft took over the top spot, and for a time was move valuable than Apple by $100 billion.
While the values of the two firms have continually changed, Microsoft is now worth just $100 billion less than Apple, according to MarketWatch. Microsoft is valued at $2.73 trillion, while Apple — fallen from its recent $3 trillion high — is currently at $2.83 trillion.
How Microsoft may be beating Apple
MarketWatch notes that Microsoft's stock rose 57% in 2023, compared to Apple's which rose 48%. Microsoft shares have also reportedly seen what are described as slimmer losses at the start of 2024.
Apple, on the other hand, has seen its shares take a considerable drop in recent days. The first hit was taken following a claim by Barclays that iPhone demand is weakening and that the iPhone 16 range will not offer any compelling new features to tempt upgraders.
The analyst view that Apple is dependent on iPhone sales is part of why Microsoft is doing better. Analysts see Microsoft has being less attached to any hardware, and more attached to subscription software such as Office 365, and so therefore less attached to any falling demand for phones or computers.
And, Microsoft has launched an AI tool in Copilot, while Apple has not unveiled any similar ChatGPT-style app or service. Analysts appear to be ignoring that Apple has been using AI for many years, under the name Machine Learning, though, and also that it is never first to a market, even ones that it later comes to dominate.
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22 Comments
They have been using AI, but have they been using generative AI?
I can't point to much of what Microsoft is doing that another company isn't doing as well.
Zoom is still a favorite for many over Teams.
Azure hasn't killed AWS.
Surface hasn't really put a dent in the iPad
Generative AI has so much issues that have already been mentioned in this thread (copyright)
the only reason why the Tech Press maintains the prattle is because they don't understand the
Tech industry beyond surface level stuff.
I find the Vision Pro launch to be significantly more important to computing than Generative AI. And if
Apple is effectively able to put LLM right in silicon without heavy reliance on external servers for most
of the daily AI tasks that will leapfrog much of today's "Hey we have AI in our app but please don't use it
too much because it's expensive" approach to extant AI use cases.
For the longest time I have written off Microsoft as being far behind Apple and Google and I didn't actually consider them a proper contender to either.
They don't have the aspirational appeal of Apple nor the software chops of Google. In fact, their UI is often very cluttered and overly complex.
However, in recent years they have become the safest tech company to bet on. People who are familiar with Microsoft's antitrust cases from way back will find it funny that the companies that were against Microsoft such as Apple and Google, are now being charged for the same things that they accused Microsoft for.
Microsoft's office suite still remains the default, their cloud services has a lot of potential even more than AWS(the current leader), Windows is the only PC choice for the majority of people (no programmer is going to buy a Chromebook and not everyone can afford a Mac), the recent game studio acquisitions has been slowly dethroning Sony and making Windows the only real PC gaming environment. Google started the cloud gaming market yet dropped out( they do this a lot...) and now Microsoft is carrying that with Xbox pass.
They don't have the same revenue dependency on ads and therefore don't have much to fear over new privacy regulations, they also don't have 50% of their revenue dependent on one product, such as iPhones for Apple.
They are also currently the leaders at AI along with Google, so I think they are future proofed too.
The only place they are lagging at is on the mobile market and I don't think they are going to succeed there as Apple and Google have grown too big in that space, but only time will tell, you never know with a company as big as them. Ever since Satya Nadella became CEO, Microsoft has been a different beast, making one right decision after another and he is arguably the best thing that happened to Microsoft.