Microsoft and Apple have been competing for the title of the world’s highest market value for many years. Benefiting from its investment in OpenAI and its leading position in the generative AI field, Microsoft’s stock price has risen by over 60% in the past year, surpassing Apple in the U.S. stock market on the 11th.
Microsoft, a technology giant, saw its stock price rise by 2% in intraday trading on the 11th, pushing its market value to $2.903 trillion, surpassing Apple and reclaiming the top spot as the world’s highest-valued company for the first time since 2021. However, Microsoft’s end-of-day increase narrowed to 0.3%, with a market value of $2.859 trillion, while Apple fell by 0.3% with a market value of $2.886 trillion. The market value gap between the two companies is likely to cross again at any time.
For years, Microsoft and Apple have been competing for the top spot in market value. However, since early 2024, Apple’s stock price has been weak, while Microsoft’s stock price has risen significantly since last year. This is due to Microsoft’s early leadership in the generative AI field through its investment in OpenAI, the developer of the AI chatbot ChatGPT.
According to Gil Luria, an analyst at investment bank D.A. Davidson, Microsoft has incorporated OpenAI’s technology into its own productivity software suite, which is expected to drive a quarterly rebound in its cloud computing business from July to September.
In contrast, Apple has been struggling with weak demand, particularly for its flagship product, the iPhone, which has seen a decline in demand in China due to the slow recovery of the Chinese economy from the pandemic and the resurgence of Huawei, which has eaten into Apple’s market share in China.
Redburn Atlantic, a brokerage firm, downgraded its investment rating on Apple’s stock to “neutral” in a report released on Wednesday, believing that China may drag down Apple’s performance in the coming years. In less than two weeks since early 2024, at least three of the 41 analysts tracking Apple have downgraded their investment ratings on the company.
Apple’s first virtual head-mounted device, Vision Pro, will be launched in the United States on February 2. This can be considered Apple’s most revolutionary new product since the launch of the iPhone in 2007, and the company has high hopes for it. However, the initial price of the device is $3,499, making it difficult for many people to afford.
Analysts also estimate that Vision Pro will have limited contribution to Apple’s revenue initially. UBS released a report on Monday predicting that Vision Pro will generate approximately $1.4 billion in revenue, which is relatively insignificant compared to Apple’s annual hardware revenue of $300 billion.
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