Microsoft has overtaken Apple to become the world's largest company by market capitalization, helped by its deep focus on generative artificial intelligence (AI), a sector that is gaining popularity among investors, reports Reuters, writes UNN.
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The tech giant, which along with Nvidia and Amazon has been focusing heavily on artificial intelligence, has experienced significant market growth over the past year. Notably, Microsoft's market value has grown by more than 1 trillion dollars, the publication writes.
Analysts draw parallels between this shift and the early 2000s, when technology and Internet companies began replacing consumer and financial firms at the forefront of the top echelons of the market.
According to LSEG data, Microsoft's market capitalization was $2.887 trillion, the highest ever, while Apple's market capitalization was $2.875 trillion at the close of trading on Friday after peaking at $3.081 trillion. Dec. 14.
Microsoft has incorporated OpenAI technology into its productivity software suite, helping its cloud computing business rebound in the July-September quarter. The introduction of AI also created an opportunity to challenge Google's dominance in web search.
Apple, on the other hand, is facing the challenges of declining demand, including for its flagship product, the iPhone.
The company is having particular difficulty in China, a key market where economic recovery from the COVID-19 pandemic has been sluggish and competition from a resurgent Huawei is intensifying, affecting its market share.
Other AI-focused technology players such as Nvidia, Meta Platforms and Alphabet have also witnessed a significant jump in their market capitalization last year.
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