As of the close of trading on Friday, Microsoft has become the world’s most valuable publicly traded company, surpassing Apple. Microsoft’s market capitalization reached $2.89 trillion, while Apple’s valuation dropped to $2.87 trillion. This shift in market capitalization is indicative of the growing importance of artificial intelligence technology to investors.
Microsoft’s rise to the top comes after a year of significant success with its artificial intelligence initiatives. In 2023, the company’s CEO, Satya Nadella, made a multi-billion dollar investment in AI, including commercializing and adding AI tools like ChatGPT into its suite of products before rivals. Microsoft’s stock has been rallying in recent months thanks to its AI announcements.
On the other hand, Apple has been facing challenges. iPhone sales are slowing, partly due to the Chinese government’s reported efforts to restrict Apple’s market share, which has helped Chinese smartphone maker Huawei to gain market share. Apple’s stock has slid 3.3% in January 2024, and it has been hit by at least three analyst ratings downgrades.
Microsoft and Apple have been trading places for the most valuable public company for years now. Microsoft surpassed Apple’s market cap in 2021, 2020, and 2018 before Apple once again regained its place at the top. However, the recent developments in AI and the challenges faced by Apple have led to Microsoft reclaiming the top spot.