The US Now Has 3 Companies Worth Over $1 Trillion

By Douglas A. McIntyre Published Apr 20, 6:43AM EDT

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The US Now Has 3 Companies Worth Over $1 Trillion — © PeskyMonkey / Getty Images

Companies have moved in and out of the $1 trillion market cap club since Apple Inc. (NASDAQ: AAPL | AAPL Price Prediction) created it in August 2018. Despite a stock market that has crashed and partially come back, three companies have shares that trade so that their values are above the $1 trillion level: Apple, Amazon and Microsoft.

It is easy to see why Amazon.com Inc. (NASDAQ: AMZN) is among the three. Its e-commerce success is driven by the need for goods that people cannot shop for in stores since so many stores have closed. Much of its competition has been plowed under by the current and deepening recession. This includes Macy’s, Nordstrom and Gap, along with hundreds of smaller retailers. Amazon says it plans to add 100,000 workers. Some of these will be replacements for workers who have had to leave Amazon facilities because of illness. Many workers have insisted the world’s largest online store add measures to protect them.

Amazon will add to its American retail market share over the next several months. Amazon’s Prime subscription service gives shut-in Americans hundreds of films and TV shows to watch. This means Prime membership is growing. The company’s market cap is $1.18 trillion so far.

Microsoft Corp.’s (NASDAQ: MSFT) cloud computing business has begun to rival Amazon’s in size. The public cloud computing business worldwide represents a market valued at nearly $225 billion. Microsoft’s server software dominated that sector, and its operating system powers almost all non-Apple personal computers, laptops and tablets. It has a robust hardware business driven by tablet and Xbox sales. Its search engine, Bing, is one of the largest in the world. The company’s market cap is $1.36 billion.

The company that may have the most significant risk of a drop below $1 trillion is Apple. It still sells tens of millions of iPhones a year. However, the downturn in the global economy has shut Apple’s physical stores and those of many of its partners, notably AT&T and Verizon. The expanding recession also makes it less likely that consumers around the world will have income for discretionary spending.

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Recent research shows Apple’s iPhone sales in China may have dropped by a third in the past month. iPhones are advanced enough that consumers may not readily buy new models. Apple’s Mac, smartwatch and services businesses cannot fill in hole created by a large decline in iPhone sales. Apple’s current market cap is $1.23 trillion.

While none of these three companies is immune from a cratered economy, each already has shown that parts of its business are essential to the economy. That means their market values will stay high.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.