Microsoft Corporation (NASDAQ: MSFT)
briefly passsed Apple Inc. (NASDAQ: AAPL) as the world’s
most valuable company Monday.
Apple
has been on a staggering trajectory in the decade since the iPhone was released, and in the process made Microsoft look like a
technology company of the past. A quick comparison of the companies' retail stores at a local mall usually shows the divergence in
consumer inerest in the brands; Microsoft simply failed to capitalize on the mobile revolution.
This makes Microsoft valuation move even more remarkable — marking the first time since 2010 that the company is
valued higher than Apple — and could potentially reignite the conversation surrounding one of technology’s biggest rivalries.
So how did Microsoft quietly stage an epic comeback?
Nadella Steps In
CEO Satya Nadella deserves a great deal of credit. When he took over in 2014, the executive said he wanted to
focus on subscription-based business and the cloud.
Microsoft’s cloud-computing unit Azure has grown at a blistering pace; it's up 76 percent annually and remains the
biggest competitor to Amazon.com, Inc. (NASDAQ: AMZN)’s AWS.
Microsoft is one of the few technology companies that emerged relatively unscathed from the recent sell-off in tech
stocks.
Apple’s valuation has been in a freefall
since passing the $1-trillion mark in August, and shares
have fallen 22 percent after the issuance of relatively weak first-quarter guidance and despite Cupertino's Q4 earnings
beat.
Apple’s decision to stop
reporting iPhone unit sales was a notably unpopular move among investors and prompted fear of a sales slowdown.
Conversely, Microsoft reported a healthy
Q1 earnings beat Oct. 24, and issued strong Q2 commercial sales guidance, projecting 19-percent growth year-over-year. The
company’s shares are up over 4 percent since its last earnings report and are now up 24-percent year-to-date.
While Apple quickly regained the title of the world’s most valuable company, Microsoft is now nipping at its heels and it begs
the question: what would the business world look like if the company had more of a mobile edge?
Related Links:
Time
For Apple's Stock To Enter A 'Period Of Digestion,' Guggenheim Says
Morgan
Stanley: Buy The Dip In Apple
Photo courtesy of Microsoft.
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