Apple could be world’s first trillion-dollar company
Wed, 10 Aug 2011 11:15p.m.
By Barbara Ortutay
Apple briefly surpassed Exxon Mobil on Tuesday as the nation's most valuable company.
The iPhone and iPad maker had the lead for much of the afternoon before its stock closed just behind Exxon's. The two companies are so close that Apple is likely to keep the top spot soon.
Apple's stock gained 5.9 percent to US$374.01 on Tuesday, bringing its market capitalization to about US$347 billion.
Exxon Mobil Corp.'s stock, meanwhile, closed up 2.1 percent at US$71.64. That gives the oil company a market cap of US$348 billion. Its stock was down earlier in the day, allowing Apple to take the lead.
Other big-name corporations, such as Wal-Mart Stores Inc. and General Electric Co., don't even come close. Apple overtook Microsoft Corp., the previous No. 2, just last year.
Does this mean people need iPads more than oil?
"Exxon obviously sells a product that people need. Apple sells a product that people want," said Brian Marshall, an analyst with Gleacher & Co. who follows Apple.
Exxon, which set a record in 2008 for the highest quarterly earnings by any company, has limited growth prospects, which are driven by oil prices and discovering new oil. It's growing, but not as quickly as Apple, which is charging ahead at the pace of a startup, Marshall says, even though the company is 35 years old.
Apple, which is based in Cupertino, Calif., has been on a roll with the soaring popularity of its iPad tablet computer and strong sales of the iPhone. Its growth is limited only by innovation. Investors expect it to grow as long as it keeps making products that people want. So investors are betting on Apple's stock even though it currently makes less money than Exxon.
In its latest quarterly report, Apple said stronger iPhone and iPad sales helped more than double its net income to US$7.31 billion and grow revenue by 82 percent to US$28.6 billion.
Exxon Mobil, meanwhile, posted a 41 percent increase in its second-quarter earnings to US$10.68 billion, the largest since it set a record of US$14.8 billion in the third quarter of 2008. Its revenue grew 36 percent to US$125.5 billion.
International companies that vie for the most valuable spot in the world include PetroChina Co., the publicly traded unit of China's biggest oil and gas company, and Petrobras, Brazil's state-controlled energy company.
In the US, Exxon and General Electric had been trading off the No. 1 and No. 2 spots until Microsoft surpassed them both in early 1999, at the height of the dot-com boom. By 2000, though, GE was No. 1 once again. According to data from FactSet, the three were close over the next five years, though Apple was ascending quickly.
Exxon Mobil, which is based in Irving, Texas, took the top spot in 2005 and, for now, remained there on Tuesday.
Marshall believes Apple may pass yet another milestone next year, when it's likely to surpass Hewlett-Packard as the world's largest technology company by revenue. In the quarter that ended in April, HP reported US$31.6 billion in revenue, compared with Apple's US$28.6 billion in the just-ended period. HP reports results for the May-July period next week.
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11/08/2011 10:05:26 a.m.
apple are disgusting bullies, trying to keep other products out of countries with legal action, too scared to actually compete.
11/08/2011 8:20:57 a.m.
Nah, I doubt it. They can't rely on greedy, insecure stupid people to keep buying their overpriced products. Sooner or later they have to wake up and realise they're being monopolized, or played like pawns. Just because something has a slightly different look or more megapixels doesn't mean your old one is obsolete. Apple products aren't so much bought for their specs so much as they are for the social status. Its sad and pathetic really.
11/08/2011 4:25:51 a.m.
"Nations most valuable company"!?, thats a joke, everything they design is outsourced to China, really China should be saying that line.
11/08/2011 12:11:29 a.m.
the problem is these figures cant be sustained . and then these gient corporations always say we cant afford more than 1% pay rise for the working people they employ . its kinda sick in some ways thats why the entire world economy is gone , the usa just lengthend the wick the other day thats all . its all based on corruption ,greed , dishonisty , and the golden rule is no were to be seen . nations have spent beyond their means for two long now there is not enogh to pay the bills . its the rich that have not paid their fair share for 50 years or so now . the globel economy is based on human corruption . and it cant continue for much longer evil never sustains for long .and evil never prospers .the love the love of money not money the love of money is the root of all thats all all evil .
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