Microsoft tops Apple as most valuable public firm

Microsoft’s big bet on cloud computing is paying off as the company has surpassed Apple as the world’s most valuable publicly traded company.

The software maker’s prospects looked bleak just a few years ago, as licences for the company ’s Windows system fell with a sharp drop in sales of personal computers.

But under CEO Satya Nadella, Microsoft has found stability by focusing on software and services over the internet, or the cloud, with long-term business contracts.

That 1990s personal-computing powerhouse is now having a renaissance moment, as it eclipses Facebook, Google, Amazon and the other tech darlings of the late decade.

Apple had been the world’s most prosperous firm since claiming the top spot from Exxon Mobil earlier this decade. Microsoft surpassed Apple briefly a few times this week, but didn’t close on top until Friday, with a market value of US$851 billion to Apple’s US$847 billion. Microsoft hadn’t been at the top since the height of the dot-com boom in 2000.

Microsoft became a contender again in large part because Apple’s stock fell nearly 20 per cent in November, while Microsoft hasn’t done any worse than the rest of the stock market. But the fact that it hasn’t done poorly is a reflection of its steady focus on business customers in recent years.

Microsoft lost its lustre as people were shunning PCs in favour of smartphones. In 2013, PC sales plunged 10 per cent to about 315 million, the worst year-to-year drop ever, according to research firms Gartner and IDC.

It didn’t help that Microsoft’s effort to make PCs more like phones, Windows 8, was widely panned.