Microsoft concisely overtakes Apple as world’s most valuable company.
Microsoft on Thursday briefly overtook Apple as world’s most valuable company for the first time since 2021.
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Microsoft shares have risen shortly since last year due to the early lead, the company has taken in generative artificial intelligence through an investment in Chat GPT maker-Open AI.
Shares were up 0.7% on Thursday, giving Microsoft a market value of $2.865 trillion. Shares of Apple were 0.9% lower, giving the company a market capitalisation of $2.871 trillion.
Microsoft and Apple have bumped into for topspot over the years.
"It was inevitable that Microsoft would overtake Apple since Microsoft is growing faster and has more to offer from the generative AI revolution", said D.A. Davidson analyst Gil Luria.
Microsoft has incorporated OpenAI's technology across its suite of productivity software.
Apple meanwhile has been dealing with weakening demand, including for the iPhone.
Demand in China, it's major market, has slumped as the country's economy makes a slow recovery from the pandemic
At least three of the 41 analysts covering Apple have lowered their rating since the start of 2024.
The Cupertino, California-based company has fallen 3% in January compared with 1.8% increase in Microsoft. Both stocks are expensive in terms of their share price-to-earnings(PE) ratio.
Apple is trading at a forward PE of 28, above its average of 19 over the past 10 years, according to LSEG data. Microsoft is trading around 31 times forward earnings, above its 10-year average of 24.
Microsoft has briefly taken over Apple as the most valuable company handful of times since 2018, including in 2021 when concerns about Covid-driven supply shortage hit the iPhone maker's stock price.
Currently, Wall Street is more positive on Microsoft.
The company has no "sell" rating and nearly 90% of the brokerage covering the company recommend buying the stock.
Apple has two "sell" ratings and only two-thirds of the analyst covering the company rate it a "buy".
