Microsoft’s valuation tops $3 trillion as AI investment booms

Yesterday, the company surpassed the $3 trillion mark for the first time but dipped below it before market close, only to rise again and close at $3.01 trillion, or $404.87 per share. This makes Microsoft the second company in history to reach this milestone, following Apple, which achieved it in December of last year and has since been competing with Microsoft for the title of the most valuable company on Wall Street.

As noted by The Verge, a significant portion of the excitement surrounding Microsoft’s stocks has been driven by the corporation’s recent focus on artificial intelligence: numerous announcements of new products have consistently boosted the stock price almost every week.

Microsoft’s investment in OpenAI

The near-record performance is attributed to the continued success of Microsoft’s products and services in the field of generative artificial intelligence (AI), both in the consumer and corporate markets.

Microsoft’s $13 billion investment in OpenAI appears to be a driving force behind the company’s current ascent. Not only has the company reported record revenue for the past two quarters, but according to Forbes, analysts expect another record-breaking sales figure to be announced in the next quarterly report, estimated to be around $61 billion.

High tide amidst a choppy sea

While Microsoft and OpenAI enjoy the fruits of their labor, regulatory bodies in the United States, United Kingdom, and Europe are examining whether the partnership between the firms should be regulated as an actual merger. Fortunately, the company from Redmond has significant experience in resolving contentious merger disputes, as evidenced by its nearly two-year-long efforts to acquire Activision-Blizzard-King, which successfully concluded in October 2023.

In the midst of investigations into the merger by the United Kingdom and the European Union, the CEO of Microsoft describes the partnership with OpenAI as “favorable for competition.”

Setting aside the upcoming regulations, many of the most rapidly growing tech stocks in 2023 and 2024 have been AI-related stocks. Nvidia has demonstrated record performance throughout the year and joined the trillion-dollar club in terms of market capitalization, while Meta and Apple have also reached record highs during this period. Meta briefly surpassed the trillion-dollar valuation again, for the first time since 2021.

Industry experts are still anticipating Apple’s next moves. Rumors continue to circulate about Cupertino-based company’s plans to introduce significant AI updates for Siri, iOS, and the iPhone in the near future, although no official information has been released yet.