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Microsoft joins Apple with US$2 trillion valuation on back of cloud computing growth

  • Microsoft is the second US public company to reach US$2 trillion in market value, after Apple, amid growth in machine learning and cloud computing
  • The Windows maker has seen its value jump 19 per cent this year so far, outperforming Apple and Amazon.com

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Microsoft CEO Satya Narayana Nadella, pictured here on February 27, 2019, is credited with turning the company around with a renewed focus on cloud, mobile computing and artificial intelligence. Photo: AFP
Microsoft Corp took its place in the history books as just the second US public company to reach a US$2 trillion market value, buoyed by bets its dominance in cloud computing and enterprise software will expand further in a post-coronavirus world.
Its shares rose as much as 1.2 per cent in New York on Tuesday, enough for the software company to briefly join Apple Inc as one of only two companies trading at such a lofty value before closing pennies short of the mark at US$265.51. Saudi Aramco eclipsed that threshold briefly in December 2019, but currently has a market value of about US$1.9 trillion.

Since taking the reins in 2014, chief executive officer Satya Nadella has reshaped the Redmond, Washington-based company into the largest seller of cloud-computing software, counting both its infrastructure and Office application cloud units. Microsoft is also the only one of the biggest US technology companies that has so far evaded the recent wave of scrutiny from increasingly active American antitrust regulators, giving it a freer hand in both acquisitions and product expansion.

Employees assist customers at a Microsoft store in Bellevue, Washington, on January 26, 2017. Microsoft's cloud infrastructure and Office apps have helped lift the company to its record valuation. Photo: Bloomberg
Employees assist customers at a Microsoft store in Bellevue, Washington, on January 26, 2017. Microsoft's cloud infrastructure and Office apps have helped lift the company to its record valuation. Photo: Bloomberg
Microsoft has gained 19 per cent 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.

The tech-heavy Nasdaq 100 Index outperformed the S&P 500 Index on Tuesday after Federal Reserve Chair Jerome Powell reiterated his view that inflation will be short lived. Both benchmarks extended gains after Powell’s comments with the Nasdaq 100 closing up 0.9 per cent and the S&P 500 up 0.5 per cent.

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