A number of news outlets reported over the weekend that Microsoft briefly overtook Apple as the most valuable U.S. company. This followed several weeks of precipitous declines for Apple, which has seen billions of dollars wiped off its market cap.
In fact, Apple continues to lead Microsoft with a valuation of $817.6 billion to Microsoft’s $791 billion. The incorrect reports were caused by confusion about Apple’s number of outstanding shares, used to calculate market cap. Microsoft is definitely getting closer, though!
Apple vs. Microsoft
Apple originally overtook Microsoft in May 2010. At the time, Apple had the comparatively paltry valuation of $222.12 billion against Microsoft’s $219.18 billion. Both lagged behind Exxon Mobil, which had a market capitalization of $278.64 billion.
Jump forward the best part of a decade and things have changed. Apple became the first $1 trillion company in history earlier this year, although it has since fallen below that mark. Microsoft, meanwhile, has reversed its early millennium slump to regain its position as a powerhouse alongside the frequently cited FAANG stocks (Facebook, Apple, Amazon, Netflix, and Google.)
Last month, Microsoft overtook Amazon, the world’s second $1 trillion company, in market value. Microsoft, however, has yet to pass the trillion dollar mark. Its success over Amazon happened because Amazon took a dip in its valuation.
It will be interesting to see how things shake out from here. Last week, Mad Money host Jim Cramer opined that the stock market, “can’t stabilize until Apple stabilizes. My view? Apple is a long-term hold, with its huge installed base giving the company’s service revenue stream a lot of room to grow, which is why you own it [and] don’t trade it. However, I can’t blame any big accounts for dumping it and, at least short term, I wouldn’t expect the stock to bottom until some of the analysts start downgrading it.”
At time of writing, AAPL is trading at $172.29. MSFT, on the other hand, is at $103.07. Just a few years back, who would have thought that the biggest clash in tech, circa 2018, would be Microsoft vs. Apple?