There’s a forgotten secret about Apple: back in 1997, it nearly didn’t make it. Struggling for survival, it received blunt advice from Michael Dell (yes, he of Dell Computers) – shut down and give your money back to your investors. Fast forward to November 2014 and financial results show it topping the $700 billion value market cap, making it not only the most valuable tech company on the planet, but the most valuable public company per se, whatever industry you’re looking at.
This is a spectacular achievement. Like Microsoft, it’s seen its shares skyrocket following the appointment of a new CEO (Tim Cook took over the Apple reins in 2011 after Steve Jobs fell ill). OK, it endured a turbulent time in 2012 and early 2013, but since then it’s been climbing not only steadily but vigorously enough to leave you wondering whether there’s some kind of business-Viagra in the drinking water at Cupertino. Since Cook’s accession, its share price has risen by a dizzying 119.9 per cent.
However, as we hinted a moment ago, Microsoft, too, has earned itself some seriously credible bragging rights in the share price department. Since Satya Nadella took over as CEO just under a year ago, shares have risen 31.58 per cent in value – not at all bad given the fact that he’s only been head honcho for a third of the time Cook has been in his job.
While both giants have rallied like a couple of tired athletes on high-voltage ginseng, some big questions remain about whether their skyward trajectories can be maintained. For example, US market analysts IDC have just reported that full-year iPad shipments are projected to fall for the first time ever as the overall market for tablets proves more sluggish than anticipated (ironically, Apple has this year manufactured more iPads than ever before). People are still consuming digital content via the mobile channel, but they’re holding onto their tablets for longer than earlier forecasts projected, replacing them every 3-4 years instead of the 2-3 years typical of smartphones.
As for Microsoft, it definitely has some bold new ideas in the SaaS space but they’re still at a somewhat embryonic stage in comparison to its other revenue lines.
But Cook and Nadella can be forgiven for hugging themselves as 2014 comes approaches its close.