The old feud between Apple and Microsoft has resurfaced, this time, due to its stock market valuation. The leadership of the group founded by Steve Jobs is being threatened by the unstoppable rise of the company created by Bill Gates, which capitalizes on its great commitment to dominate the artificial intelligence (AI) market.
It happened just for a moment during the day on Thursday, but Microsoft unseated Apple as the most valued company in the world. It was 2:36 p.m. (GMT) when Microsoft's capitalization rose to 2,899 million dollars (2,644 million euros) while Apple's valuation remained at 2,896 million dollars (2,642 million euros). Satya Nadella, CEO of the group that owns Windows, would be about to celebrate the great event, but shortly after, Apple returned to first place in the ranking, from which it has practically not moved for ten years.
Despite this, Microsoft's momentary surprise to Apple is a warning from the market to the multinational led by Tim Cook. “The stock market is moved by future expectations and not by milestones achieved in the past,” says Jaume Puig, general director of the investment firm GVC Gaesco. And right now no one doubts that Microsoft's commitment to AI – which has sealed an alliance with ChatGPT – places the group with more advantage over Apple. “Since the launch of the iPhone in 2007, this company has not presented anything groundbreaking that has represented a change in the digital industry like that phone or generative artificial intelligence,” says the analyst.
In addition, the Cupertino (California) firm suffers from demand problems for its products. Especially in China, where the economy is slowly recovering from the pandemic and where brands like Huawei are gaining strength. “China could be a drag on Apple's evolution in the coming years,” analysts from the Redburn Atlantic firm point out in a note collected by the Reuters agency, which also warns that 40 companies that follow Apple's price have lowered their ratings. for this 2024.
Meanwhile, Microsoft, from its headquarters in Redmond, Washington, is capitalizing on the euphoria unleashed by generative artificial intelligence, capable of creating text and images by imitating the skills of a human. “Despite the legal difficulties that this technology faces, the business potential is enormous, since the productivity of companies skyrockets. That is precisely what stock market investors reward,” says Puig.
However, GVC analyst Gaesco considers that there is a certain overvaluation of companies that develop generative AI. "The potential of this technology is on everyone's lips and, although it is true that Microsoft has a solid project, we can already see a valuation bubble in companies in this sector." Not only in the stock market, also in the private sector. Startups that develop generative AI attract all the attention of venture capital funds, which had slowed investment in technology after the pandemic boom. In 2023, they will allocate nearly $50 billion to these companies, according to data from the Crunchbase portal. The figure will go up this year. This is what most analysts' predictions predict, such as the one made at the end of December by the consulting firm Pitchbook. “AI will continue to be a megatrend in 2024, especially in businesses that facilitate the automation of tasks in the world of work,” says analyst James Ulan.
With all expectations placed on AI, Microsoft is sailing with the wind in its favor to surpass Apple's stock market value. It wouldn't be the first time he achieved it. In fact, its capitalization was higher until well into the second decade of the 2000s, when the success of the iPhone exploded. Since then, the apple firm has been the undisputed leader in the stock market, except for a brief parenthesis of a few quarters in 2019 and 2020 during which it was ousted by Microsoft.
2024 may be the year in which the market once again tips the scales towards Bill Gates' empire. The fight between both companies goes back a long way, from the plagiarism lawsuits that Apple began to launch against Microsoft during the 1980s. Fifty years later, the rivalry is still more alive than ever.
