Microsoft Becomes The Second Company To Reach A $2 Trillion Market Cap

Anas Khwaja Ahmed, 2 years ago 0 2 min read 65

On Tuesday, Microsoft Corps became the second American public company to achieve a towering market value of over $2 trillion, with Apple Inc. has been the first company to reach that milestone last year. Oil giant Saudi Aramco, which had gone public in 2019, also has previously passed the $2 trillion thresholds, but its market cap is currently valued at $1.88 trillion.

Microsoft Becomes The Second Company To Reach A $2 Trillion Market Cap

Although it took Microsoft 33 years from its debut in the stock market to reach its first trillion in 2019, attaining the next trillion took only two years, largely thanks to the global pandemic which has seen people from all walks of life become dependent on Microsoft’s services. Microsoft has gained 19% so far this year, outperforming Apple and Amazon.com Inc., as investors piled into the stock on expectations of long-term growth for both earnings and revenue, and expansion in areas like machine learning and cloud computing.

The company’s third-quarter results, released in late April, topped expectations and demonstrated strong growth across its business segments, and since March 2020 when lockdown first went into effect Microsoft’s stock has risen by 64%.

Since becoming CEO in 2014, Satya Nadella has made sure that Bill Gates’ legacy is one of the biggest driving forces of technology and innovation across the globe, with a focus on cloud, mobile computing, and artificial intelligence.

Hilary Frisch, the senior research analyst at Clearbridge Investments, stated,

“Microsoft has its hands in a lot and it is doing it all well: gaming, cloud, automation, analytics, AI, it is an attractively valued name within tech, and it should benefit from both the economy reopening as well as from a more pronounced shift toward the cloud.”

According to data compiled by Bloomberg, the Intelligent Cloud business accounted for 33.8% of Microsoft’s 2020 revenue, making it the largest of the three major segments for the first time, and up from 31% in 2019. The division showed revenue growth of 24% last year, compared with the 13% growth in Productivity and Business Processes, and the 6% growth of Microsoft’s More Personal Computing unit.