Microsoft overtakes Amazon as second-most valuable US company
The IT behemoth is now second to Apple as the most valuable company in the US after the latest Google results
San Francisco — Microsoft regained its spot as the second-most valuable US company on Friday after a disappointing quarterly report from Amazon wiped $65bn off the online retailer’s market capitalisation. Apple tops the list at moer than $1-trillion after crossing that threshold in September.
Microsoft’s market capitalisation was Wall Street’s highest from late 1998 to early 2000 before the dot-com bubble burst. Amazon’s shares dropped 75%, the most in nearly three years after its holiday season sales outlook missed targets, fanning concerns that Wall Street’s tech darlings are finally starting to face stronger competition.
Microsoft fell a more modest 1.1% in a broad technology sell-off that was also driven by a weaker-than-expected report from Google-parent Alphabet, leaving the Nasdaq composite index down 1.9% late Friday afternoon.
Shares of Microsoft remain up nearly 4% from Wednesday, when the four-decade-old software company beat quarterly profit expectations, driven by its cloud computing business that competes with Amazon’s.
Its stock market value on Friday stood at $823bn, on track to close above Amazon’s for the first time since April, when it gave up its spot as second-largest company by market capitalisation. Amazon was worth $805bn on Friday, after falling below Microsoft in extended trade on Thursday.
The drop was equivalent to the combined values of Target and Corning. Amazon’s tumble left it up about 40% for the year to date, while Microsoft has gained about 25% in 2018. On Wednesday, Amazon’s stock traded at the equivalent of 70 times expected earnings, its lowest level since 2011.
The average analyst price target for Microsoft puts its market cap at $963bn, while the average price target for Amazon values it at $1.068-trillion. Apple will report quarterly results on November 1.