Microsoft closes over $ 2 trillion in market capitalization for the first time

Microsoft CEO Satya Nadella gives a lecture on Dream, Struggle and Creation at Tsinghua University on September 25, 2014 in Beijing, China. Nadella visited China for the first time on Thursday.

Visual China Group | Getty Images

Microsoft is now worth more than $ 2 trillion.

The software maker hit this level for the first time on Tuesday, June 22, just after 3:00 p.m. ET, but fell below that level again before closing Thursday’s trading session at $ 266.69 per share. The milestone follows the unveiling of Windows 11, the first new version of the flagship operating system in more than five years, on Thursday morning.

Microsoft’s value has doubled in two years, supported by demand for products like the Teams chat app that kept businesses running during the coronavirus pandemic.

The company’s share price appreciation reflects a rejuvenated company that has looked beyond its dominant Windows operating system and noted growth in cloud computing and acquisitions.

Microsoft stock has risen more than 600% since Satya Nadella replaced Steve Ballmer as the company’s CEO in 2014. (During Ballmer’s 14-year tenure as CEO, the company’s stock fell 32%.) One of Nadella’s first steps was revealing that Office apps like Word and Excel came on Apple’s iOS and Google’s Android, rather than those apps on smartphones to restrict which Windows was running on. A year later, when Windows 10 came out, it was a free update, unlike Windows 7 and Windows 8.

Nadella had led the department that includes Microsoft’s Azure public cloud right before taking the CEO job, and it shows. During his years as CEO, he appeared publicly to speak to well-known customers such as the National Basketball Association, Volkswagen and Walgreens about the use of Azure. Azure is well on its way to becoming Microsoft’s largest company.

Microsoft under Nadella has become gentler and more open to working with rivals where it makes sense. It improved relationships with rivals such as Red Hat and Salesforce, and injected the open source Linux operating system, once seen as a threat to Windows, directly into Windows. On Thursday, the company announced that Windows 11 will support apps running Google’s Android operating system, and Nadella spent the end of the company’s presentation portraying Microsoft as a friendlier option for software developers than Apple.

Venture investor Ben Horowitz said Microsoft is a great company to work with these days, and not a company to fear.

Nadella’s Microsoft has largely avoided avoiding antitrust reviews, despite its past, which included a groundbreaking antitrust case by the US Department of Justice in 1998. Meanwhile, Amazon, Apple, Facebook, and Google all face pressure from regulators during the Nadella years. However, team communication app maker Slack filed an antitrust complaint in Europe last year after Microsoft introduced and released Teams to customers who had subscribed to the Office 365 package.

Recently, the top Republican on the House of Representatives Judiciary Committee Jim Jordan of Ohio sent a letter to Microsoft President Brad Smith suggesting it could be included in parts of five proposed antitrust laws going through the committee.

Microsoft has spent more than $ 45 billion acquiring companies for Nadella’s watch, including the social network LinkedIn, video game developers Mojang and Zenimax, and code storage service GitHub. Microsoft has largely left it to them to act and grow independently. In April, the company announced that it had agreed to acquire voice recognition company Nuance for $ 19.7 billion, including equity and debt.

Nadella’s transaction record was more successful than that of its predecessor, whose aQuantive and Nokia acquisitions resulted in write-offs. Mojang’s Minecraft game, on the other hand, has become the best-selling game in history, and LinkedIn’s quarterly revenue nearly tripled.

Microsoft was one of the first companies to top a $ 1 trillion valuation when it hit this milestone in April 2019. Not long before that, Microsoft had regained the title of Most Valuable Public Company, although it is now held by Apple.

Amazon and Google’s parent company Alphabet are both worth more than $ 1 trillion, as is oil company Saudi Aramco.

CLOCK: Hybrid working arrangements are here to stay, says Microsoft

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