Microsoft tops Apple to become world's most valuable company

Apple Inc lost its crown as the world`s most valuable public company to Microsoft Corp on Friday, as the iPhone maker`s shares continued their downward slide.

Apple took a $6 billion hit to its sales during the fiscal fourth quarter due to a nagging global supply chain problem, leading to a miss on Wall Street expectations. Top boss Tim Cook said the impact will be even worse in the current holiday sales quarter.

"Compared to less hardware-focused FAANG peers, Apple is also a lot more exposed to supply chain disruption," said Sophie Lund-Yates, equity analyst at Hargreaves Lansdown.

Cupertino, California-based Apple`s shares were down 3.6% at $147, implying a market capitalization of $2.41 trillion. The Windows software maker`s shares were up 0.7% at $326.8 at a market valuation of $2.46 trillion. Microsoft`s shares were trading at a record high.

Apple, which has repurchased $421.7 billion over the years, had announced a massive $90 billion share buyback in April. As a result, the company`s outstanding stock pool keeps shrinking, ending its fiscal fourth quarter with 16.4 billion shares.

Microsoft's stock has surged more than 45% this year, with pandemic-induced demand for its cloud-based services driving sales. Shares of Apple have climbed 15% so far this year.

Apple’s stock market value overtook Microsoft`s in 2010 as the iPhone made it the world`s premier consumer technology company. The companies have taken turns as Wall Street`s most valuable business in recent years, with Apple holding the title since mid-2020.

Analysts say Apple has managed the supply chain issue well, but with Cook warning of more pressure, the door is open to a hit to its performance as the holiday season kicks in.


In contrast, Microsoft on Tuesday forecast a strong end to the calendar year thanks to its booming cloud business, but it warned that supply-chain woes will continue to dog key units, such as those producing its Surface laptops and Xbox gaming consoles.