Microsoft is Now Worth $3 Trillion, Thanks to Gen AI

Microsoft just became the second most valuable company in the world, with its stock closing above the $3 trillion market value threshold today - for the first time ever.

Shares closed at $404.87, up 0.6% from the prior day when it first crossed the rarefied valuation but ended the day below it. Microsoft is second in value only to Apple, the first company to get the honors last June.

Microsoft is widely seen as a frontrunner in generative AI due to its $13 billion investment in and exclusive Azure cloud partnership with OpenAI, the maker of ChatGPT.

Other AI leaders in the rarefied trillion-dollar club are the following:

Google is a prominent AI leader and its market cap is just shy of $2 trillion as of today's close.

Meta is a gearing up to be the AI leader in open source models. The social media giant’s focus on AI is a boon; its market cap is just over $1 trillion. Meta was initially in the trillion-dollar club in 2021 but lost its footing.

Amazon is the cloud leader and is investing $4 billion in AI startup Anthropic, arguably OpenAI’s chief rival. The company is worth $1.6 trillion as of today's market close.

Nvidia, who has dominant market share in advanced AI chips, first joined the trillion-dollar club last May. It is now firmly in the club, with the company’s market cap at $1.5 trillion.

Related:Nvidia Flirts With $1 Trillion Market Valuation

While Apple has been largely on the sidelines in the generative AI race, it reportedly has been buying up companies and hiring AI staff to make a big play in generative AI.

Big gap with other AI companies

Chipmaker AMD, which is set to ship its advanced AI chip MI300 this year, has a market cap of $291 billion. Intel is not far behind, at $209 billion.

IBM, which has a longer history in AI than many other tech companies, is valued at $174 billion. In 1977, its Deep Blue computer beat a human grandmaster in chess for the first time.

Tesla, which its founder Elon Musk argues is an AI company and not just an automaker, was in the trillion-dollar club in 2021. But rising competition, recalls and other woes put a dent in market value. As of today, the company is valued at $572 billion.