It is an important weekend in the computing world as Microsoft has claimed the title of Most Valuable Company, on Friday, stealing the top spot from direct competitor Apple Inc. Microsoft ended the week—at market close—with a market value higher than $851 billion. This is notably more than Apple’s $847 billion.
In the sporting world, this could be seen as a major upset, as the two have been battling out for the apex position all week, but Apple always came out ahead by the end of each trading day.
Unfortunately for Apple, share prices have been on a steady—and sometimes even steep—decline, especially in recent weeks. At the close of the week, Apple shares were down roughly 0.5 percent, to finish at $178.60 while Microsoft shares moved upward at the same increment, boosting 0.6 percent to $110.80 at the close of the trading day.
But this small drop for Apple is only the latest in a trend of decline. Since October, shares of Apple have fallen nearly 25 percent, which is actually a steeper drop than the overall market. The drop comes on the heels of concerns about slowing demand for smartphones and, of course, over the potential tariffs the US may be taking on when it comes to imported Chinese goods.
The recent sell-off, then, has erased more than $200 billion from the tech company’s total market value. This number is calculated by multiplying a company’s share price by the number of traded shares they cite in their most recent quarterly financial report.
It is important to note, however, that while Apple may have slipped from its penultimate position as a leader in market value, the company is still, technically, bigger. When you look at annual revenue and profit, for example, Apple definitely remains bigger than Microsoft.
That in mind, however, investors are more likely going to turn towards Microsoft as a better and brighter market prospect, at least for the time being. For example, Microsoft has a cloud service unit that has been driving overall growth over the past couple of years while Apple has established a revenue stream that depends heavily on consumer spending.