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Microsoft hasn’t been worth this much more than Apple since 2003

Microsoft’s market cap is about $309 billion larger than Apple’s. Just 16 months ago, Apple was $719 billion ahead. Microsoft Corp. continues to pull away from Apple Inc. in terms of market capitalization — so much so that the gap between them is the widest it’s been in over two decades.

Based on intraday action, Microsoft MSFT, +0.45% has a $3.063 trillion market cap Friday, while Apple’s AAPL, -0.60% clocks in at $2.754 trillion. If the corresponding stock-market action carries through to the close, that would translate to a $309.4 billion margin, the largest between these two companies since Oct. 21, 2003, according to Dow Jones Market Data.

Of course, the picture was much different back in 2003, when the $312.1 billion spread between the two tech players was almost as large as Microsoft’s entire valuation. Microsoft commanded a $320.2 billion market value on Oct. 21, 2003, while Apple’s valuation was only $8.1 billion.

See also: Microsoft earnings may have offered a big bullish clue about cloud growth

For context about Apple’s business at the time, its annual filing for 2003 discussed “advanced new digital devices such as the company’s iPod digital music players, personal digital assistants, cellular phones, digital still and movie cameras, CD and DVD players, and other electronic devices.”

Apple’s business is of course much more advanced now, but investors haven’t been too excited about it this year, with the stock off about 8% so far in 2024.

The company returned to year-over-year revenue growth in its latest quarter after four quarters of declines but suggested revenue could fall again in the ongoing quarter. Some on Wall Street have questioned whether Apple’s innovative ways are waning.

The market-cap gap between Apple and Microsoft is especially staggering considering how far ahead Apple was just under a year and a half ago. Apple was worth $719.2 billion more than Microsoft on Oct. 28, 2022, according to Dow Jones Market Data.

The decline in Apple shares to start 2024 comes after the stock surged 48% in 2023. Microsoft, on the other hand, has been able to sustain its momentum from last year: Its stock advanced 57% then but is up another 10% so far this year.

Microsoft, in the eyes of Wall Street, appears a play on the hot artificial-intelligence market, as the company’s Azure cloud-computing business benefits from growing customer interest in AI workloads. At the same time, Microsoft has been infusing its own software products with AI functions, and the company has invested in OpenAI.