Microsoft has become the third US company to achieve a trillion-dollar valuation
Microsoft’s better-than-predicted quarterly financial results prompted a share price increase that saw the company’s market capitalization briefly surpass the trillion-dollar mark, a feat previously achieved only by Apple and Amazon.
Following Microsoft's excellent third-quarter financial results, the company's share price climbed high enough to push its market capitalization above the trillion-dollar mark, if only for about half an hour.
Apple was the first publicly quoted US corporation to pass the trillion-dollar barrier on August 2 last year, while Amazon was the second, on September 4. But, as with Microsoft, their share prices retreated shortly afterwards.
In all three cases, analysts started predicting the event long before it happened. While breaching the trillion-dollar barrier has no financial, intellectual or moral significance, apparently stock market pundits have seen it as a mark of success.
Microsoft revealed double-digit growth in its third-quarter financial results on Wednesday (April 24). Revenues grew by 14 percent to $30.6 billion, with profits climbing 19 percent to $8.8 billion. What really excited the stock market, however, was the 73 percent increase in revenues from Azure cloud services. This helped drive a five percent rise in Microsoft's share price to $131.37, finally elevating it into the 13-digit club.
At the time of writing, Microsoft's share price has fallen back to $129.72, valuing the company at $995.4bn. This is slightly ahead of Apple's market cap of $973.2bn, and Amazon's $942.8bn.
Google (aka Alphabet) is now the only one of the "big four" that has yet to reach a trillion-dollar valuation. Its share price has climbed significantly this year, but its market cap is only $881.7bn.
These share prices reflect an extremely long bull run, and have recovered from a dip in December 2018 prompted mainly by America's trade war with China. How much longer the bull run will continue is, of course, a matter for speculation: share prices go down as well as up.