NEW YORK – Microsoft's big bet on cloud computing is paying off as Apple has surpassed Apple as the world's most valuable publicly traded company.
The software maker's prospects looked grim a few years ago as licenses The Windows system of the company, however, went back with a strong decline in sales of PCs.
However, under CEO Satya Nadella, Microsoft found stability by focusing on software and services over the Internet or the cloud with long-term business contracts.
The 1990s personal computing powerhouse is currently experiencing a renaissance moment as Facebook, Google, Amazon and the other tech favorites of the late decade are overshadowed.
Apple has been at the forefront of Exxon Mobil's most successful corporate group since its inception at the beginning of this decade. Microsoft briefly outperformed Apple a few times this week, but did not close at $ 871
Microsoft again became a big part of the competitor, as Apple's stock had fallen by nearly 20 percent in November, while Microsoft had not done so the rest of the stock market. The fact that this was not bad is reflected in the steady focus on business customers in recent years.
Microsoft lost its shine as people plundered PCs for smartphones. In 2013, PC sales dropped 10 percent to around 315 million. This is the strongest year-on-year decline, according to research companies Gartner and IDC. It did not help that Microsoft's efforts to make PCs more like phones (Windows 8) were widespread.
But a turnaround began when the company in Redmond, Washington, promoted Nadella as CEO in 2014. He followed Microsoft's longtime CEO Steve Ballmer, who initially mocked the idea that people were willing to pay $ 500 or more for Apple's iPhones.
This bet was worth it. Windows is now a dwindling part of Microsoft's business. While continuing to drive consumer-facing companies like Bing Search and Xbox Gaming, the company has prioritized business-oriented services such as the Office email suite and other workstation software, as well as newer additions such as LinkedIn and Skype. However, the biggest growth is in the cloud, especially on the cloud platform called Azure. Cloud computing now accounts for more than a quarter of Microsoft's revenue, and Microsoft is a leading provider of such services with Amazon.
Wedbush analyst Dan Ives said Azure is still in its infancy, with plenty of room for growth given the company's large customer base for office and other products.
"While the tech slaughter seen last month was brutal, (Microsoft) shares continue to hold up like the Rock of Gibraltar," he said.  Less reliant on consumer demand, Microsoft protected against the turmoil of the Christmas season and the US and Chinese trade disruption affecting Apple and other tech companies.
President Donald Trump raised these concerns when he told The Wall Street Journal in a later-released story Monday that new tariffs could affect iPhones and laptops imported from China.
The iPhone maker had already seen its shares fall after reporting a mixed set of quarterly results in early November, fears that the technology industry was facing threats such as rising interest rates, heightened government regulation and escalating concerns Trump's trade war with China will threaten.
Apple had also annoyed investors with an unexpected decision to stop publishing many iPhones are being sold every quarter. This move has been widely interpreted as a sign that Apple expects a further decline in iPhone sales and seeks to obfuscate it.
While smartphones caused the downturn in personal computers years ago, sales of smartphones have now stopped. This is partly due to the fact that with fewer innovations from the previous models, more users will stick to the devices for a longer time before the upgrade.
Daniel Morgan, senior portfolio manager of Synovus Trust, said Microsoft is outperforming its technical competitors in part. There is not as much regulatory scrutiny as Google and Facebook, who are hungry for advertising, have sparked controversy over their data collection practices. Unlike Netflix, it's not chasing down a decreasing number of international subscribers. And although Amazon has a strong cloud business, it's even more dependent on online commerce.