After the opening of the U.S. stock market at 9:43 p.m. local time on January 11, 2024, Microsoft's stock price rose 1.43% to $388.24 per share at 9:43 p.m., with a market capitalization of $2.886 trillion, while Apple's stock price fell 0.57% to $185.13 per share, with a market capitalization of $287.9 million. Currently, the two companies are still pulling ahead in terms of market capitalization figures. This makes it at least so that for a moment, Microsoft surpassed Apple as the public company with the highest market capitalization in the world.
Less than two weeks into 2024, two of the world's largest tech companies are seeing different trends. Apple shares started the year down 3.8% as of press time on Jan. 11, evaporating nearly $600 million in market value, while Microsoft rose 3.2% over the same period, adding $240 million to its market value. This comes on the heels of most U.S. tech giants seeing their market capitalization skyrocket to varying degrees throughout 2023, with Microsoft's shares up 59% and Apple's up 48%.
2023 is the year of the generative AI explosion, and Microsoft has hitched a ride with its focused Intelligent Cloud business, which generated $87.9 billion in revenue for Microsoft in FY2023 (the 12 months ending June 30, 2023). It was Microsoft's highest revenue-accounting business in FY2023, at 41%; it was also Microsoft's strongest-growing business in FY2023, leading the way with 17% year-over-year growth.
In March last year, Microsoft released new features of Azure OpenAI service and became a cloud service provider for OpenAI. The Microsoft Build 2023 developer conference was titled "Artificial Intelligence Redefines the Future of Software Development and Work", and AI has become the main theme of Microsoft's current development.
Behind the rapid development of intelligent cloud business is the current CEO of Microsoft Satya Nadella (Satya Nadella) maneuvering. Since Nadella took office on February 5, 2014, Microsoft's market value has increased nearly 20 times.
Ten years into his tenure as CEO, Nadella is betting on cloud infrastructure and is rooted in the enterprise services market. In an interview with foreign media last year, he said, "The biggest opportunity we have is artificial intelligence." Microsoft has invested in OpenAI since 2019, and in 2023 announced the decision to pursue billions of dollars. Since joining Microsoft in 1992, Nadella has led significant strategic and technological transformations covering Microsoft's major products and services - including a move toward cloud computing. Before taking over as CEO, Nadella was Microsoft's executive vice president in charge of the cloud and enterprise business units.
This year, "AI+" will continue to expand the imagination. At CES2024, generative AI is already at the intersection of various consumer electronics products such as PCs, cars, and home appliances. Recently, Microsoft plans to change the layout of the Windows keyboard to add a Copilot button to wake up the AI assistant, which has already begun to appear on the new AI PCs from its partners at CES2024.
In contrast, the current Apple is facing a crisis of weak iPhone sales. in August 2011, Apple for the first time surpassed ExxonMobil Oil Company, becoming the world's largest company by market capitalization, and since then the valuation has continued to break through, and in January 2022 it became the world's first company with a market value of more than 3 trillion dollars.
However, Apple's position in 2023 constantly encountered challenges from Microsoft. In 2023 September, Apple released new products such as the iPhone 15 and iPhone 15 Pro, but it seems that the response was average. In the capital market, Apple's stock price rose briefly on September 22, the day of the official launch of the new products and the next trading day, and then continued to fall back, reaching a low on October 27th. According to the Reuters news agency, investment bank Jefferies (Jefferies) analysts reported that in the first week of 2024, iPhone sales in China fell 30%, this figure this year faced a double-digit decline. Jefferies analysts believe that this is mainly attributable to the fierce competition from local Chinese brands, especially Huawei's strong return to the high-end market after the release of the Mate 60 series last August. Previously, Apple has been Barclays analysts and other institutions bearish, was downgraded from "hold and wait and see" to "reduce".
However, riding on the wind of AI high-speed growth in Microsoft also has hidden worries. According to foreign media news on January 9, Microsoft's $13 billion investment in OpenAI is facing a review by EU regulators. Last December, the British Competition and Markets Authority (CMA) became the first competition regulator to investigate the transaction between Microsoft and OpenAI. Currently, Microsoft holds a 49% stake in OpenAI.
And Apple is trying to move away from its current questionable situation, wanting to take an innovative step in its hardware products, which creates uncertainty about its future valuation. on June 5, 2023, Apple unveiled its first spatial computing device, the Apple Vision Pro, to seamlessly integrate digital content into the real world, with an operating system, visionOS, that is controlled by the user's eyes, hands, and voice. On January 8, Apple's website indicated that the Apple Vision Pro would be available in the United States on February 2, starting at $3,499.
If the Vision Pro goes on sale and gains market success, then perhaps the capacity issue will be the biggest factor constraining the continued growth of Apple's stock price. Currently, after Microsoft briefly overtook Apple, the current ranking of the world's top 10 public companies with the highest market capitalization are Microsoft, Apple, Saudi Arabian National Oil Company, Alphabet, Amazon, Nvidia, Meta, Berkshire Hathaway, Tesla, and Eli Lilly and Company.
