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Microsoft Is Now More Valuable Than Alphabet (cnbc.com)
Microsoft has surged 40 percent over the past 12 months to become more valuable than Alphabet. "As of Tuesday's close, Microsoft was worth $749 billion and Alphabet's market capitalization stood at $739 billion," reports CNBC. From the report: Microsoft's latest rally has been sparked by growth in its cloud computing business, which is bigger than Google's though it still trails Amazon Web Services. In March, Microsoft reorganized its Windows and Devices Group and moved its engineering resources into other units, including one focusing on cloud and artificial intelligence. Both Microsoft and Alphabet beat analysts' expectations in the first quarter. Microsoft still trails behind Apple's market valuation of $923 billion and Amazon's $782 billion market cap.
This seems entirely academic to me. They're about the same size and neither is out for your good.
And the difference seems to be mostly from re-arranging things on paper to boot. Colour me suitably impressed.
Comparing Microsoft to Google is embarrassing. Google makes much of its revenue from ads, Microsoft is extremely well rounded tech company selling a OS, Azure, Xbox, Office Suite, Cloud services, and hardware. Now comparing Apple to Microsoft would be a much more equal comparison.
older Evil vs newer Evil works for me
Can anyone beat Apple to a Trillion?
Then I learned that Apple reported net income of 50B annually recently.
Apparently, marketing works. They probably have the highest markup margin in tech.
I do not believe in karma. "Funny"=-6. Do good and forbid evil. Yours, Oft-Offtopic Flamebaiting Troll.
"Man, that's a lot of ___". (Fill in the blank in your reply.)
Sheesh, evil *and* a jerk. -- Jade
That's not how that works.
According to cocaine nose jobs from WallStreet?
(Sorry, I've never been convinced by the stock market - to me it's one enormous speculation).
That's an amazing grasp of market economics you have there.
You win the award of the wrongest person on Slashdot today
Then I learned that Apple reported net income of 50B annually recently.
They've been around that number for the last three years. Please do keep up.
Apparently, marketing works.
Companies don't get to Apple's size without provide a shit ton of value to customers. Might not be value to you but it definitely is value to a lot of people and it sure as shit isn't just marketing.
They probably have the highest markup margin in tech.
No they do not. It's not at all uncommon for software companies to have higher margins than Apple. Microsoft routinely has higher net margins than Apple. On average around 5% higher which is a HUGE amount.
What ?
You know you can split stocks right ? Microsoft did it multiple times to reduce the price of one share, but it doesn't change anything on the market cap.
The only metric that matter is market cap. Alphabet and Amazon could decide to split on a 1:10 ratio to lower the entry price, market cap would stay the same... basic math.
Apple, Microsoft and Facebook have achieved their huge "market cap" simply by issuing more shares of stock than anyone else -- billions of shares.
Umm, you do realize that if you put more shares out they will be worth less individually, right? The share price isn't fixed so you don't get a bigger market cap just by issuing more shares. There has to be demand for the shares regardless of the number of them. Berkshire Hathaway famously hasn't split their shares for a long time so each share is worth tens of thousands of dollars. You can have the same market cap with fewer shares with a higher value or more shares with a lesser value. It's literally identical to saying a $20 bill is identical in value to two $10 bills. It's only the total value that matters.
The price of an individual share is immaterial. Issuing more shares just dilutes the value of existing shares. If you do a two-for-one stock split, the share price halves. The main benefit of having a lower individual share price is that it makes it easier for smaller investors (e.g. individuals) to get in on the game. Apple in particular doesn't like their share price to get too high, so they've done regular two-for-one splits to keep it at a level where it's easy enough for individuals to afford to buy a round lot of shares.
That's slightly less wrong than the original dumbass, but still rather out to lunch.
In very simple terms stocks are just a representation of ownership. If I start a business, I own 100% of the stock. If I then decide I would like some cash instead of ownership, I can sell you 50% of my stock. Now you and I own an equal share of the business. If the business earns a profit, we each get 50% of the profit (this is known as dividends). When a major business decision needs to be made, we each get an equal say. If the business gets bought up by an outside entity, we split the price of the sale. Etc.
Of course each of us is free to further sell our one half to as many people as we like. And if we agree to it together, we can split our shares to slow for a finer grain of subdivision. This is where the other guy was confused. If you and I each own 50% of 1000, worth $100 each, we can agree that we each own 50% of 10,000 worth $10 each. The number of shares doesn't affect the goal value of the company, nor does it have anything to do with debt; it only affects the unit price of the stock.
I'm no expert, but does issuing more shares not just mean you are more in debt?
No. Debt is a different thing. Shares are not a loan, they are a percentage ownership in the company. When you issue stock for sale you are literally selling a portion of the company. Nothing is being loaned. Debt holders typically get repaid before anyone else. Equity holders typically get paid last.
That's not to say that the new owners won't expect a return on their investment but the expectation is that this will come from company growth without a fixed timeline or cash outlay. Generally speaking equity is usually more expensive than debt because the risk to the investor is higher. Research "cost of capital" if you want to understand more.
Aren't shares essentially taking a mortgage on your company, but you do not even have to pay anything back, beyond empty promises.
No they aren't like a mortgage at all. The new owners will expect a return on their investment, this will come in the form of a growing company profits. If the company doesn't deliver those profits at some point the stock price will plunge and the company will either be sold/liquidated or will be unable to raise additional capital. If the company cannot raise capital and isn't profitable then they will go bankrupt.
One evil empire just pulled ahead of another evil empire.
Did you know 80 to 90% of the moderators on slashdot wouldn't recognize a troll even if one dragged them under a bridge.
But valuation is based more on potential than revenue.
One can value a company anyway they want to. Discounted Cash Flows, Book value, P/E ratios how tall the management is, what one thinks the potential is, what one is TOLD the potential is, ALL the above, one's own model,.....
But keep in mind, ALL of those methods are trying to predict the future. Finance is the only field I have ever witnessed fortune telling being taken seriously - to be a bit hyperbolic.
In the end it's what people perceive the value is. And some is panic..
I was scratching my head over why some of these tech valuations are so out of line with the mean (we're approaching year 2000 valuations here). Who's buying this at these prices?!
Hint: Their money doesn't grown on trees but is pumped out of the ground and they know it isn't going to last so they are looking to diversify. They have a welfare state to support and their citizens are known for blowing shit up.
That is one way to do it (although technically it's a little bit more than just agreeing ;))
Another way is to issue new stocks, let's say for instance we need $50000 for some investments, and we have an investor willing to pay that.
Then we can issue 500 new stocks, for $100 each, which would bring the total number of stocks up to 1500. Each stock would still be worth $100, but the market value would raise from $100 000 to $150 000, and each of us would own 33.33% of the company.
Of course, if the investor is really keen on investing, and we decide to only issue 100 new shares for $500 each, then the market value would raise from $100 000 to $550 000, and we would own 45.45% each and the investor 9.1%.
Stock value works on supply & demand. If the company issues more stock, the price will go down if there are no other factors pushing it up. A company with lots of cash and a poor performing stock price will do a buy back which forces the price up because now there are fewer available.
Who is Older Evil and who is Newer Evil?
Microsoft Started April 4, 1975
Apple Started April 1, 1976
Neither are new companies, they are actually rather old for tech companies.
They have been flip flopping back and forth which is more hated.
Microsoft was well liked because you could buy a computer from multiple manufacturers and have your software work on it, while Apple you were stuck with Apple Hardware.
Microsoft with dominance in windows, Began to make their products shotty and broken (Windows ME) because they had such a hold on the market. That alternative systems such as OS X seemed to be a refresher ( I am leaving Linux out of the discussion, because in terms of consumer tech, Linux stayed at a distant 3rd ) as it was a newer interface with a more solid back end. Then Apple got into the iPod which made Apple cool, so people started to want to get those cool Macs. It was still Apple Hardware being stuck with Apple software, but it was good enough to take the risk.
Now today. For the consumer market. ( Not including power users, and gamers ) The OS isn't a big deal. The Browser is the king. And the browser has been ported to most of the popular platforms, and every browser now works more or less the same way. So I can have an Apple device, a Microsoft Device, a Google Device, With different OS's and software. I could get something with some unknown OS, and some unknown browser. Just as long as it is complete and supports the standards, it will work for most of my tasks.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
Jeez even microsoft employees are turning to linux. Well, this will only be a good thing. I'm really excited about what is going to come down the pipe as more developers start picking up the linux craze and the general population explores it and likes it.
I'm with you though, tried out linux (mint/ubuntu/raspbian for me), never went back, it was just awesome. My wife is using it too, she's got a little raspberry pi hooked up in the bedroom to do facebook and watch tv shows and movies, she loves the thing. I'm thinking about getting some for our relatives since they make a great little stocking stuffer gift.
Is essentially cherry picking profit from the rest of the company pretending it comprises a cloud offering.
I can't really agree with that statement, as Microsoft has kind of "reinvented" themselves as a cloud services company. They probably make as much money off of Azure and Office 365 than they do selling copies of Windows now.
Your logic suggests we can have the government simply print twice as much cash, give the second half out to the poor, and cure poverty. Why didn't anyone think of that!
To be fair, you're comparing a software company to a hardware one.
No I am not. Apple is a software company at its core. No less an authority than Steve Jobs himself has said so publicly. Not a traditional one to be sure but they don't actually make any of the hardware they sell so they by definition cannot be a hardware company. A company is what it makes and for all practical purposes the only thing Apple actually makes themselves is software. They design some of the hardware but that's not the same thing.
"I've turned down offers from IBM before and sent them nasty replies"
Man, if Wall Street gets wind of the fact that IBM received a letter from some self entitled douchebag, IBM stock will crash hard!
Go home Ben, you're drunk.
He's saying Google is the "newer evil", not Apple.
People think of Microsoft as a software company still, but the reality is that they're not. Google may own all your data, but Microsoft's looking to be the platform that basically every on-premises computing environment migrates to. They are officially done selling software licenses...it's going to be guaranteed perpetual monthly revenue from their customers forever. Soon as they get customers to move to Azure, it's the ultimate vendor lock-in.
You might say "there's no lock-in, I can go to AWS/GCP/whatever anytime I want!" Maybe, but they're being very smart...allowing anyone to build totally platform-agnostic solutions, but dangling just enough proprietary stuff that Just Works(TM) and is the path of least resistance. It's also by far the easiest way to run Windows environments in a hybrid manner where some stuff lives in your data center and others can run in the cloud. I think this is what's going to keep them going the same way IBM is. IBM is making billions off customers who can't migrate off the mainframe and whose businesses literally depend on the mainframe applications running the core of everything staying up. IBM has been able to fumble around trying to become a management consulting firm and bargain-basement offshore workhouse for the sole reason that their mainframe business is an ATM.
I think that once Microsoft saw how willing people were to pay monthly for Office 365 forever, that was the end of enthusiastic support for perpetual licensing and on-premises deployments.
Desktop Linux is still a niche which I don't see changing right away. But most of the world's smartphones run Linux, as do most of the servers (including many hosted by Microsoft itself), and Microsoft now seems to recognize the value of "playing nice" in order to position itself in growing market segments while still making a decent return on the stagnant or declining ones. There may be something on the horizon to disrupt these trends, but if there is, I'm not seeing it, so my educated guess is you'll see these ones continue at least for a while.
Nonaggression works!
My first thoughts were "Alphabet?...what does Alphabet do...." Didn't even remember that stupid name from google restructuring at first....
The most VALUABLE company in the world: Berkshire Hathaway. After all, their stock price is a huge $290,975 per share! They have to be the most highest valued company according to your logic, right?
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
from giving away an OS for free.
The data users send back must be of great value when sold on the open market.
Domestic spying is now "Benign Information Gathering"
It is not just older vs newer evil, these companies have different evil based on their business model.
Apple is a hardware company, their evil is planned obsolescence
Google is an advertising company, their evil is invasion of privacy
Microsoft is a software company, their evil is proprietary software lock down
Amazon is an online shopping company, their evil is destroying the local economy
From a business standpoint, you have to give Microsoft credit for staying on top for 4 decades. No other major tech company has done that. Even IBM didn't reign on high as long. The rapid pace of tech change usually grinds giants down.
Don't get me wrong, M$ is a conniving jerk, but they pulled off an unprecedented business feat.
Table-ized A.I.
I agree there is bound to be a major breach of a major cloud provider that will damage cloud's reputation, creating a major P/R kick to the nuts.
I'm not saying cloud is necessarily less secure, only that breaches will affect a lot of companies at the same time, creating a P/R nightmare. It's comparable to car crashes versus plane crashes. Your chance of dying in a car is higher per mile, but it rarely makes the news because deaths are piecemeal, unlike jet crashes.
It's not necessarily fair, but it's the way news works, setting cloud up for an ugly future.
Table-ized A.I.
Apple, Microsoft and Facebook have achieved their huge "market cap" simply by issuing more shares of stock than anyone else -- billions of shares.
LOL, that's not how shares work.
Comparing Microsoft to Google is embarrassing. Google makes much of its revenue from ads, Microsoft is extremely well rounded tech company selling a OS, Azure, Xbox, Office Suite, Cloud services, and hardware. Now comparing Apple to Microsoft would be a much more equal comparison.
Google has an OS, Cloud offerings (which you mention twice for Microsoft), Google Docs (as well as other cloud offerings), and hardware. They also do things MS does not, like sell phones. And create services that people really want and use. It could be argued that they jam them down your throat via the Android platform - which is most assuredly true - but they are true innovators. They rule search (you forgot to mention Bing). They gave us Maps maps with traffic and streetview. So many more things that while I don't find valuable I know others do. Here is a link in case you need it... https://www.google.com/about/products/.
So yes, it is embarrassing to compare the two companies... one has been innovating and producing for a long time, the other has always been about maintaining a grip on a monopoly. That monopoly that has slowly slipped away. I think that the only reason Azure is taking off is because that monopoly was so strong for so long. And to be clear, I am not really a big user of google because I value my privacy. I don't turn on my location on my phone. I used maps to check traffic. I disable as many of their services on my phone that I can. I just don't quite trust them. But I can't deny their innovations, investment, and ability to drive technology.
My beliefs do not require that you agree with them.
Or issue class B shares with lesser voting powers, and class C shares who get in the back of the line when there's a bankruptcy, and so forth. These are all ways to keep the original invetors happy, or as ways to maneuver around dislodge the original owner, etc. This happens with private companies, since when becoming public you have to be much more transparent and follow external rules.
Android will kill them, because they are open. Not totally. But kill growth and then a long, slow decline.
Even some of my kids friends at school have given up on expensive iPhones. And Apple is, today, a one product company.
They pulled a rabbit out of the hat with iPad. Then continued that with the iPhone. But there is now no obvious place to go.
They are hoping for another rabbit with self driving cars. But that is already a crowded space, unlike the old iPad or iPhone markets.
If Apple had been a software focused company they would own the entire smart phone market, like Windows still owns PCs. Sell some high end hardware themselves, but also license the software to others. Before something like Android has a chance to become established. Microsoft owns PCs because everybody else makes them.
But Apple started as a hardware company (supported by software) and that is how they will, eventually, die. Very profitable in the short term, but absolutely guaranteed to produce a strong competitor that is more open.