While Microsoft co-founder and former CEO Bill Gates has dropped from the “World’s Richest” list as a top contender these days, the company he started has ascended the ranks as the world’s most valuable company.
Earlier today, Microsoft slipped past Apple as in the rankings as the World’s Most Valuable Company based on market cap among publicly traded companies. The shift in rankings between Microsoft and Apple comes after the latter missed earnings expectations despite posting arguably another stellar quarter for the business.
The margin of bragging rights for Microsoft is relatively slim and maybe even become outdated within a day or two when skittish investors return to their senses, but for the time being, the Redmond based software company sits at $2.47 trillion in market cap while Apple lingers in the second spot at $2.42 trillion.
Back in 2020, during a lull in the pandemic spread, Microsoft surpassed Apple in market cap due to a similar set of circumstances that highlighted its cloud-based revenue pivot versus Apple’s supply chain supported hardware revenue earnings.
While Microsoft beat revenue expectations to report a 22 percent increase in revenue growth, Apple at the same time fell victim to a reality vs. estimation pitfall where a 29 percent increase in revenue growth still comes up short for investors. Despite iPad and iPhone revenue being up for the quarter, Apple had to warn investors that a possible $6 billion hit to the stock may be on the horizon as the company faces pandemic related supply chain constraints during the holiday quarter.
However, to put Apple’s cautionary stock advisement into perspective, the company generates close to a billion-dollar revenue a day, so the according to CEO Tim Cook, Apple is set to have one bad week in three months.
As for Microsoft, CEO Satya Nadella issues a similar warning to investors but as previously mentioned, the company relies less on hardware sales than Apple and its cloud business continues to chomp out revenue in the market as it grows. Microsoft’s upward trajectory is backed by investor confidence which has resulted in an increase in the stock value of up to 47% year to date.