US-based technology giant, Microsoft’s stock market value has surpassed the $3 trillion mark for the first time, making it the world’s second most valuable company, just behind rival Apple.
The software maker’s shares reached a record high of $405.63, experiencing a 1.7% increase that propelled the company’s market capitalization above $3 trillion. However, it closed slightly below the threshold at $402.56, resulting in a valuation of $2.99 trillion. Apple, with a market value of $3 trillion, maintained its lead as the most capitalised stock.
Microsoft’s investments, including its backing of OpenAI, the creator of ChatGPT, have positioned it as a frontrunner in the race for dominance in the generative artificial intelligence (AI) landscape. The company has leveraged OpenAI’s technology to enhance its flagship productivity software products and the Bing search engine, competing more effectively with Google’s search offering.
Analysts attribute Microsoft’s success to its strong AI narrative, emphasizing the company’s optimism and clarity in its AI strategy. In contrast, Apple faces challenges related to slowing demand for iPhones, particularly in China, where it is resorting to discounts to stimulate sales amid fierce competition from local rivals, especially Huawei.
Microsoft’s AI-focused approach has garnered investor confidence, with its shares surging nearly 57% in 2023 and continuing to rise by 7% this year. In comparison, Apple’s stock increased by 48% in the previous year, with a marginal 1% uptick in the current year.
As both companies navigate the evolving tech landscape, Wall Street analysts remain optimistic about Microsoft’s trajectory, with a median price target of $425. The company’s AI initiatives, coupled with its overall performance, contribute to its resilience and growing market valuation. The race for technological dominance among major tech players, including Google, Amazon, Oracle, and Meta Platforms, continues to shape the dynamics of the industry. Wall Street awaits upcoming financial results from these giant tech companies, anticipating their impact on market trends.
