Apple lost its crown as the world’s most valuable public company to Microsoft on Friday, as shares of the iPhone maker fell nearly 2 percent.
Due to persistent global supply chain problems, Apple lost $6 billion (about Rs 44,940 crore) in its sales during the fiscal fourth quarter, beating Wall Street’s expectations. Top boss Tim Cook said the impact would be worse in the current holiday sales quarter.
“Compared to less hardware-focused FAANG peers, Apple is also heavily exposed to supply chain disruption,” said Sophie Lund-Yates, equity analyst at Hargreaves Lansdowne.
Apple shares fell 1.8 per cent to $149.80 (approximately Rs 11,200 crore) to end the session, giving the company a market capitalization of $2.48 trillion (approximately Rs 1,85,75,202 crore). In contrast, shares of Windows software maker Microsoft rose 2.2 per cent to hit a record high of $331.62 (around Rs 24,800 crore), ending the session with a market capitalization of $2.49 trillion (about Rs 1,86,49,489 crore).
Apple, which has repurchased shares worth $421.7 billion (about Rs 31,53,186 crore) over the years, had in April announced a massive $90 billion (about Rs 6,74,077 crore) share buyback. As a result, the outstanding stock pool continues to shrink, and the company ended its fiscal fourth quarter with 16.4 billion shares.
Microsoft’s stock is up 49 percent this year, driven by pandemic-induced demand for sales of its cloud-based services. Apple’s shares have risen 13 percent so far this year.
Apple’s stock market value overtook Microsoft in 2010 as the iPhone made it the world’s leading consumer technology company. The companies have stepped up in recent years as Wall Street’s most valuable business, with Apple holding the title since mid-2020.
Analysts say Apple has managed the supply chain issue well, but with Cook’s warning of more pressure, the door is open for its performance as the holiday season approaches.
In contrast, Microsoft on Tuesday predicted a strong end to the calendar year. But it also warned that the supply-chain crisis would continue for dog major units, such as those producing its Surface Laptop and Xbox gaming consoles.
© Thomson Reuters 2021