Microsoft passes Amazon to become the second most valuable publicly traded U.S. firm

by Alan Friedman / Oct 28, 2018, 4:01 PM

Microsoft passes Amazon to become the second most valuable publicly traded U.S. firm

Back on September 4th, Amazon became the second publicly traded U.S. firm to reach a one trillion dollar valuation. Of course, Apple had done it first on August 2nd. While Apple has risen an additional 4.4% since hitting the trillion dollar mark, Amazon's shares have declined by 20%. As a result, Amazon is no longer the second most valuable U.S. company and Reuters says that this honor now belongs to Microsoft.

Microsoft's shares have risen 13% from a close of $95 on May 1st to reach $106.96 by Friday's close. The software giant now has a valuation of $821 billion versus Amazon's valuation of $801.3 billion. For all of 2018, Amazon is still up 40% compared to 25% for Microsoft.

On Wednesday, one measure of Amazon's stock valuation, its price-to-earnings ratio dropped to 70. That means that the company's shares are trading for 70 times its earnings per share figure, and it is the lowest such reading for Amazon since 2011. Just last week, Amazon disappointed investors with its third quarter earnings report. While the company crushed expectations for its third quarter earnings, it estimated a lower range for operating income and revenue for the current quarter. Since the fourth quarter includes the all-important holiday shopping season, investors are taking the lower estimates as warning signs for Amazon's performance during the holidays.

Microsoft, on the other hand, last week reported fiscal first quarter earnings that investors were happy with. For the company to be the third U.S. publicly traded company to reach a valuation of one trillion dollars, Microsoft will need to rise 22% to hit $130.

Options

10 Comments

1. gamehead unregistered

Ever since Amazon introduced their stupid seller policies I liked them less so I find this news great.

posted on Oct 28, 2018, 6:46 PM 0

2. rouyal

Posts: 1573; Member since: Jan 05, 2018

Microsoft? I wouldn’t have guessed. I thought they’d be slow bleeding money with how popular (to say the least) smartphones and iPads have become. Maybe their “as a service”, the Office subscription, and placing ads in the OS is working for them. I know there’s things that can only, or are better, done on PC - but there hasn’t been a need to upgrade since Windows 7.

posted on Oct 28, 2018, 7:51 PM 1

3. cncrim

Posts: 1585; Member since: Aug 15, 2011

Microsoft bleeding on mobile department however every else is very positive specially no one is challenging their PC department.

posted on Oct 28, 2018, 8:34 PM 2

7. Peaceboy

Posts: 640; Member since: Oct 11, 2018

If 75% can afford mac then its over for them. Same with the phone, they would always opt to apple.

posted on Oct 29, 2018, 1:44 AM 0

8. SIGPRO

Posts: 2813; Member since: Oct 03, 2012

BS! Even if mac was cheaper it would not happen, because Windows is more powerful. I don't see fruit many company stuff being used for Enterprise. And this world runs on Linux and Windows, fruit company cannot compete in these sectors!

posted on Oct 29, 2018, 2:00 AM 2

9. cmdacos

Posts: 3974; Member since: Nov 01, 2016

Apple itself barely cares about the Mac...

posted on Oct 29, 2018, 2:59 AM 1

4. Settings

Posts: 2943; Member since: Jul 02, 2014

Anyway it's just ranking. They still are profitable and will be in the future.

posted on Oct 28, 2018, 9:00 PM 0

5. worldpeace

Posts: 3106; Member since: Apr 15, 2016

They didn't make much money from Windows for PC. 60% of Windows in use globally is pirated one and that's the old number, and Microsoft giving free upgrade for windows 7 and 8 to 10, they barely make any money from 10, and they decide to make 10 the last version they'll ever make, and future windows will still called 10 but with updates. They make money from Windows server, office 365, and server+cloud services. Don't forget that they also own Bing and Xbox.

posted on Oct 28, 2018, 10:05 PM 1

6. Leo_MC

Posts: 6938; Member since: Dec 02, 2011

Microsoft has the best software tools for enterprise usage and that is where the big money is. I would not trust Google with my office needs, some cloud services are cheaper (and very trustworthy), virtual machines are a breeze on MS products and every single powerful tool a enterprise needs is on Windows (and easier to use than in Unix based OSes).

posted on Oct 29, 2018, 1:13 AM 1

10. Crispin_Gatieza

Posts: 3112; Member since: Jan 23, 2014

I don't know where these stupid posts about Microsoft losing money on mobile come from. They make money on every single Android handset sold because of patent licensing. Put down the meth and learn something, anything.