Yesterday, a historic event occurred in the traditional financial markets: Apple stocks lost their leadership against Microsoft shares.
In fact, the market capitalization of Apple’s shares has fallen below $2.9 trillion, while that of Microsoft’s shares has risen above that threshold.
And so yesterday Microsoft was the publicly traded company with the highest market capitalization.
Apple leadership beaten by Microsoft actions
The Apple stock has been the largest market capitalization since October 2021. But excluding the very short period in which it lost the leadership in this ranking in October 2021, lasting less than two weeks, we have to go back to September 2019 to find a longer period during which it was not the largest company in the world by market capitalization.
To be honest, this is a ranking that only takes into consideration the companies listed on the stock exchange, that is, those for which there are daily updated data on the stock price.
However, since even the shares of Saudi Aramco (the national oil company of Saudi Arabia) are on the market, all the major companies in the world are part of it.
Saudi Aramco, however, is effectively a state-owned company, of which only a small portion of the shares are publicly tradable.
When it comes to market capitalization, only the so-called public companies are usually compared, that is, those whose majority is controlled by the market.
The end of Apple’s growth
Starting from August 2023, Apple’s stock has stopped growing.
Taking as a reference the pre-pandemic value of about $80 per share, this had even skyrocketed to $180 by the end of 2021, corresponding to a market capitalization of over $2.7 trillion.
After a retracement lasting almost a year, in 2022, last year the stock resumed its growth, reaching its peak in July when the share price almost touched $200. At that point, the market capitalization had risen to nearly $3.2 trillion.
However, since August there has been a long period of sideways movement, still ongoing, below $200. The market capitalization has stabilized below $3 trillion.
Microsoft’s ride against Apple stocks
The only public company in the world capable of challenging Apple in terms of market capitalization is Microsoft.
The pre-pandemic price of Microsoft shares was around $180, with a market capitalization of approximately $1.3 trillion.
During the 2021 ride, Microsoft’s stock reached an all-time high in November, when its price soared to nearly $350, and its market capitalization had reached $2.7 trillion.
At that point, Microsoft was already competing with Apple for the title of the world’s largest public company by market capitalization, excluding Saudi Aramco.
Even for Microsoft, 2022 was a year of bear market, but 2023 was different compared to Apple.
In fact, the growth that started in January 2023 has not stopped yet.
If in August the price of Microsoft shares had risen to $350, now it is at new all-time highs, at around $390. Thanks to this further growth, the market capitalization has risen to $2.9 trillion, ending up surpassing Apple.
So until July 2023, Apple had dominated this ranking for years, although always chased by Microsoft, while since August 2023 it has stopped growing. Instead, Microsoft continued to grow even after August 2023, eventually surpassing Apple.
Market capitalizations
Apple still remains the only public company in history to have ever exceeded a market capitalization of 3 trillion, and its current 2.8 trillion is not a much lower figure. The absolute record was almost 3.2 trillion.
Apple was also the first ever to exceed one billion dollars in market capitalization, already in 2018, and also the first to exceed two trillion in August 2020.
All of this suggests that yesterday’s Microsoft overtaking may not be definitive, and that if Apple’s stock were to start growing again, a counter-overtaking could occur, even in a short period of time.
The Microsoft title has never surpassed 3 trillion dollars in its history, and the current 2.9 trillion is its all-time high.
It exceeded one trillion already in 2019, but it had to wait for the great bull run of 2021 to exceed 2,000 billion.
Instead, Saudi Aramco directly exceeded $2 trillion the day after its partial listing on the stock exchange, in December 2019. Since then, it has never been able to exceed $3 trillion.
Note that in 2019, the market capitalization of Saudi Aramco was higher than that of Apple, but while the American company’s market capitalization grew significantly in the following years, that of the Arab company did not grow much anymore.