Microsoft Surpasses Apple in Market Value by $540 Billion

As the calendar turned from 2023 to 2024, a dramatic shift unfolded in the hierarchy of the world's most valuable public companies.

by Faruk Imamovic
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Microsoft Surpasses Apple in Market Value by $540 Billion
© Getty Images/Stephen Brashear

As the calendar turned from 2023 to 2024, a dramatic shift unfolded in the hierarchy of the world's most valuable public companies. Apple, once the crown jewel of the stock market, has seen its value eclipsed by Microsoft, marking a significant change in the competitive landscape of technology giants.

A Shift in Market Dynamics

At the close of Thursday's market, Apple's valuation stood at $2.65 trillion, trailing behind Microsoft's towering $3.19 trillion. This gap of $540 billion is not just a figure but a representation of the changing fortunes of these tech behemoths.

Only a few months ago, at the end of December, Apple boasted a market capitalization of $3 trillion, approximately $200 billion more than its rival. The shift in market positions is a stark reflection of the companies' stock performances this year, with Apple's shares declining by 11%, while Microsoft's have surged by 14%.

Apple's decline is attributed to several challenges faced under the leadership of CEO Tim Cook. The tech giant's introduction of the new Vision Pro headset met with skepticism, while its ambitious car project was reportedly abandoned after years in development.

Further complications arose with a sales downturn in China and a hefty fine of nearly $2 billion by EU competition regulators, accusing Apple of abusing its market dominance against competitors like Spotify. The woes compounded with the Department of Justice launching an antitrust lawsuit against Apple, alleging it maintained an "illegal monopoly on smartphones" to the detriment of consumers and developers.

Microsoft's Ascendant Trajectory

In contrast, Microsoft has enjoyed a year of bullish enthusiasm from investors, largely fueled by its association with OpenAI's ChatGPT and a potential leading role in the artificial intelligence revolution.

With the launch of AI tools such as Copilot and its standing as one of the top three cloud service providers, Microsoft is strategically positioned to benefit from the next computing boom. Financially, the company has shown impressive growth, with a 15% revenue increase to about $119 billion and a net income leap of 30% to over $44 billion in the six months leading to December.

While Apple has experienced a dip in its annual revenues by 3% to $383 billion and a similar decline in net income, the future could still hold a reversal of fortunes. Apple's innovative capacity and market resilience could narrow the current chasm between it and Microsoft, potentially regaining its position as the market leader.

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