Microsoft Reclaims Spot
Good news for Microsoft as it reclaimed the spot of the second most valuable American company this past Friday. Its good fortune came after Amazon’s weak quarterly report whichremoved over $65 billion from the company’s market capitalization.
Apple Inc. Maintained its spot on the list as its cap remained at the over $1 trillion mark which it crossed in September. The shares of Amazon plummeted with 7% which made it the most it had lost in about 3 years after its sales outlook of the holiday season missed target. That in turn increased concerns that the tech darlings of Wall Street are finally beginning to encounter stronger competition.
Microsoft dropped with only about 1.1% in a wide technology sell-off which was driven by a weaker-than-projected expectations from Alphabet Inc., the parent company of Google. That left the Nasdaq composite index down with about 1.9% late in Friday afternoon.
The shares of Microsoft remained up with about 4% from Wednesday and that was when the software company performed better than the quarterly profit projections as driven by its cloud computing infrastructure. The market capitalization of Microsoft was the highest for Wall Street in the late 1998 even through the early 2000 before the burst of the dot-com bubble.
The market value of Microsoft stock on Friday was at $823 billion as it was on the track to close above that of the online retailer since the time it took over its previous spot. As at Friday, Amazon was valued at $805 billion after it fell below Microsoft in the extended trade the day before. The fall was equivalent to the sum of the value of Corning Inc and Target Corp. Analysts on an average put Microsoft price target at $963 bullion and that of Amazon at $1.068 trillion.
The rankings change was caused by the fall in the stock value of Amazon. It is expected that Apple will report its quarterly finances this coming Thursday. It will be recalled that Apple became the first ever U.S. company to have a valuation that passed the $1 trillion benchmark after it recorded stock buybacks.
The shares of Amazon fell at a period when President Trump has reportedly floated stricter regulations on the tech company.
Trump has a long-standing mutual hostility with the CEO of Amazon, Jeff Bezos who is also the owner of the Washington Post. He criticized the deal the company made with the U.S. Postal Service and also raised questions as to whether the company was paying enough taxes.
The online retail company announced earlier in the month that it would increase its company minimum wage to 15 dollars per hour and that was some sort of victory for those who had clamored for the company to increase the benefits and pays it gave to workers.
The e-commerce company which is also a cloud computing firm was founded on the 5th of July 1994 by Jeff Bezos. He founded the company in his garage in Washington.
It began only as an online bookstore and it has gone on to become the world’s largest online retailer based on revenue and market capitalization. Based on the total sales, the company is second toChina’s Alibaba Group.
The company over the years has diversified its activities as it has gotten involved in different e-commerce activities such as sales of video downloads as well as streaming , downloads and also streaming of music, video games, audiobooks, electronics, apparel, food and a host of other things.
Amazon is the largest cloud infrastructure service provider in the world. It also produces its own line of customer electronics like Kindle e-readers and Amazon Echo smart speakers. The company also sells different products under the brand called AmazonBasics.
Amazon’s operation is on a global scale and it launched the Amazon Prime paid subscription service sometime in 2005. It also established its Amazon Go Grocery stores in Chicago and Seattle that started in December 2016. Earlier this year, it established Amazon 4-Star retail center majorly for products that are highly rated in New York. In 2017, Amazon bought Whole Foods for $13.4 billion.