Microsoft Corp. overtook Apple Inc. to become the world’s most valuable publicly traded company for the first time in more than two years, as worries over smartphone demand have weighed on the iPhone-maker’s stock in recent weeks.
The Redmond, Washington-based software giant rose 1 percent to $388.47 on Friday, ending with a market valuation of $2.89 trillion. Meanwhile, Apple gained 0.2 percent and closed with a market capitalization of $2.87 trillion. It’s the first time since November 2021 that Microsoft has closed with a higher value than Apple.
“When you compare and contrast the two, the growth Apple is showing is nothing special, whereas Microsoft has done a better job of executing and demonstrating earnings growth,” said David Katz, chief investment officer at Matrix Asset Advisors, which has positions in both. “Microsoft also has a much clearer roadmap with AI, and it has done a great job articulating how that will accelerate growth to make its long-term prospects even more compelling.”
While both were part of the so-called Magnificent 7’s powerful rally in 2023, their fortunes have diverged this year. Microsoft has risen 3.3 percent, supported by ongoing optimism over artificial intelligence, while Apple has dropped 3.4 percent amid rising concerns over its growth. It has been hit by at least three analyst ratings downgrades, according to data compiled by Bloomberg.