Technology

Apple Takes Large Lead in Global Market Cap Race

Douglas A. McIntyre

Published: December 30, 2024 8:15 am

Last March, Apple Inc. (NASDAQ: AAPL) lost its long-held position as the world’s most valuable company. It fell behind Microsoft Corp. (NASDAQ: MSFT) by $554 billion as it dropped to $2.6 trillion. Microsoft’s market value at that time was $3.2 trillion. Because of its app store, Apple had been hit by worries about federal government investigations into its potential monopoly position. Microsoft was riding its position as one of the leading providers of artificial intelligence software.

What a difference nine months makes. Apple’s market value has surged to $3.86 trillion. Nvidia Corp. (NASDAQ: NVDA) is in second place at $3.36 trillion due to its massive lead in the AI chip business. Doubts about when Microsoft will benefit from its AI investment have made investors wary about its short-term future. Its market cap has fallen to $3.20 trillion.

Since March, Apple has made two moves that have encouraged investors. Its iPhone 16 is an early success. It finally widely released its AI flagship known as “Apple Intelligence” as part of its new iOS 18. The outlook Apple gave when it released its most recent quarterly numbers was encouraging. These have pushed Apple’s shares up 33% this year, compared to the S&P 500’s 25% gain.

Year to date, Microsoft shares are up only 14%. Its earnings were a disaster. Its forecast, in particular, caused the largest sell-off in the stock in the past two years.

Nvidia’s stock is up 177% this year due to its massive lead in the AI chip market. It holds 65% of the global AI data center chip market.

The next big test of Apple’s stock value will be when it releases earnings for the fourth calendar quarter of this year. It will be the first full quarter that includes three months of iPhone 16 sales and the results of holiday demand.

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