This change occurred as Apple faced its worst start in years due to concerns about decline in demand.
Microsoft overtook Apple to become the world's most valuable company on Thursday. This change occurred as Apple faced its worst start in years due to concerns about decline in demand. The increase in the market valuation of Microsoft is driven by its early advantage in profiting from generative artificial intelligence, which has attracted investors.
Meanwhile, Apple's market capitalisation dropped to $2.871 trillion, marking the first time since 2021 that it fell below Microsoft's valuation.
“It was inevitable that Microsoft would overtake Apple since Microsoft is growing faster and has more to benefit from the generative AI revolution,” said D.A. Davidson analyst Gil Luria, reported Reuetrs.
Apple's stock weakness followed several downgrades, raising concerns about iPhone sales, especially in China, where competition from Huawei and Sino-US tensions could impact performance. Additionally, Apple’s services business – a bright spot in recent quarters – faces threats as regulators deepen scrutiny of a lucrative deal that makes Google the default search engine on iOS.
Shares of Apple, whose market capitalisation peaked at $3.081 trillion on 14 December, ended last year with a gain of 48 per cent.
Microsoft's aggressive rollout of genAI-powered tools, in collaboration with OpenAI, contributed to its success.
Although Microsoft has briefly surpassed Apple in the past, the current sentiment on Wall Street favours Microsoft.
Currently, Wall Street is more positive on Microsoft. The company has no “sell” rating and nearly 90% of the brokerages covering the company recommend buying the stock.
Apple has two “sell” ratings and only two-thirds of the analysts covering the company rate it a “buy”.
With inputs from agencies
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "Representational image")
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}