Apple Might Lose Position As Highest Valued Company To Google

The slumping sales of Apple iPhones might let Google become the highest valued company.

As the market for online advertising has boomed and the smartphone demand has waned, Alphabet is now capable of dethroning Apple as the most valued company. If this happens, Alphabet will move to the top just 5 months after the Mountain View based company did its reorganization under its holding company.

The technology giant could soon trade places, given how quickly the financial difference between the two is narrowed. At the closure of trading on Friday, the market value of Apple was $540bn, while Alphabet was valued at $524bn.

The change has taken place dramatically from where it was standing almost a year ago, the smartphone maker then was valued at $643bn, almost double of Google’s $361bn. Since then, investors have been souring on Apple. The organization has not been able to launch another trend-setting device amidst the slow growth of the sales of its most significant product, iPhone, which contributes for approximately two-third of the total sales of Apple.

The Cupertino-based enterprise confirmed that iPhone would begin in 2015 with its first quarterly decline in sales since it was launched in 2007. The slump played a role in pushing down the stock of Apple by 12% since 2014 ended.

In contrast, Google has continued to lead the lucrative online search and advertising market while developing other famous products in mapping, web browsing, mobile, video and email. Google’s bundle of services contributes to maximum revenue of Alphabet, and would probably grow 15% to 20% as promoters shift even a larger share of their budgets to digital facilities.

Alphabet has also appeased investors by reining its expenditures. It recruited a veteran of Wall Street, Ruth Porat, as its CFO last May. Investors also have appreciated the development of the company, which is structured to provide more details regarding the cost of its experimental projects into city management, health science, internet access facilities, and driverless vehicles.

All those factors have played a role in lifting the Alphabet’s stock – earlier Google’s – by 43% since late in 2014. It is possibly a huge shift for Apple, which has held bragging rights as the most valued company for past four and half years.

Standard & Poor’s revealed that Alphabet would turn into the twelfth company that has succeeded to reach the most valued spot. Of course, Apple is not simply rolling over. According to reports, it is trying to develop new products like Internet TV, virtual reality and driverless cars that could conceivably reignite its growth of revenue.