As Microsoft stock rises and Apple's falls over analysts expectation of slowing iPhone demand, the two firms are once more within $100 billion of each other — the smallest gap in over two years.

Apple and Microsoft have a long history of competing for the title of the world's most valuable company, although originally that was specifically in the technology category. In 2010, Apple dethroned Microsoft when it hit a market capitalization of $222 billion, and then in 2018 Microsoft briefly regained that top position.

Now those sums seem quaintly low, and the two companies have instead been vying for the title of most valuable company globally, in any category. In August 2020, Apple became the first publicly-traded US company to reach a $2 trillion market cap, and Microsoft became the second one in June 2021.

Later in October 2021, Microsoft took over the top spot, and for a time was move valuable than Apple by $100 billion.

While the values of the two firms have continually changed, Microsoft is now worth just $100 billion less than Apple, according to MarketWatch. Microsoft is valued at $2.73 trillion, while Apple — fallen from its recent $3 trillion high — is currently at $2.83 trillion.

How Microsoft may be beating Apple

MarketWatch notes that Microsoft's stock rose 57% in 2023, compared to Apple's which rose 48%. Microsoft shares have also reportedly seen what are described as slimmer losses at the start of 2024.

Apple, on the other hand, has seen its shares take a considerable drop in recent days. The first hit was taken following a claim by Barclays that iPhone demand is weakening and that the iPhone 16 range will not offer any compelling new features to tempt upgraders.

The analyst view that Apple is dependent on iPhone sales is part of why Microsoft is doing better. Analysts see Microsoft has being less attached to any hardware, and more attached to subscription software such as Office 365, and so therefore less attached to any falling demand for phones or computers.

And, Microsoft has launched an AI tool in Copilot, while Apple has not unveiled any similar ChatGPT-style app or service. Analysts appear to be ignoring that Apple has been using AI for many years, under the name Machine Learning, though, and also that it is never first to a market, even ones that it later comes to dominate.