Apple Loses ‘World’s Most Valuable Company’ Title To Exxon
For almost a year, Apple held the position of ‘World’s Most Valuable Company’, impressing economists, business analysts and technology enthusiasts alike. After recent stock fluctuations, the Cupertino company has moved back to second place, being surpassed once again by the energy company Exxon Mobil.
In February of last year, Exxon was said to have a market cap of $400 Billion, while Apple blew through this figure with a valuation of $500 a share and a market cap of $470 Billion. The company held on to its title throughout most of the year, until yesterday when its share price reached a low of $439.88 and its total worth (or market capitalization) reached $413.06 Billion, while Exxon fared at $418.23 billion.
What does this mean for Apple? Aside from a significant share price drop and some reduced confidence on the part of investors, it is not likely to mean much in the medium and long term. The stock price dropped below $500 per share for the first time last week following disappointing iPhone 5 sales and rumors that the Cupertino company is curbing production due to lack of orders. Apple’s revenue growth and device sales are still nothing short of impressive, despite slowing in the last few quarters. Over the last few years, the company’s growth has resembled the one of a technology startup than a large multinational corporation.
At its earnings call on Wednesday, Apple declared record iPhone and iPad sales, with 48 million iPhone units sold in the holiday season. It took Samsung, the company’s closest competitor, nearly 7 months to sell 40 million units. However, the fruit company did not specify how many of the 48 million sales were of the iPhone 5, which many have criticized as not being enough of a leap to justify an upgrade. Apple attributes the slowdown in device growth to lack of manufacturing capacity during the holiday season.
Apple can take advantage of its upcoming events, including the looming Worldwide Developers Conference this June, in order to prove to investors that it can remain innovative and competitive. The company’s CEO Tim Cook has claimed that the product pipeline is “chock full”, therefore the opportunity is definitely there to turn the situation around.