Sat 01 August 2020:
Apple Inc. became the world’s most valuable company with its market value overtaking Saudi Aramco in the wake of better-than-expected earnings.
The dethroning of Aramco comes after a tumultuous period for the Saudi company. Its initial public offering fell short of Crown Price Mohammed bin Salman’s expectations. The kingdom’s de facto ruler initially wanted a valuation of $2 trillion and to raise $100 billion. But after foreign investors balked at the pricing, the government settled on a smaller domestic offering and raised about $30 billion, still the largest IPO ever.
Then came this year’s plunge in crude prices as energy demand crashed with the spread of the virus. Aramco’s second-quarter revenue probably dropped to about $37 billion from $76 billion a year earlier, according to analyst estimates compiled by Bloomberg. That’s less than the $59.7 billion in sales that Apple reported for its most recent period.
Aramco’s stock is down 6.4% since the end of December, though that’s far less than the fall of other oil majors. Exxon Mobil Corp. has declined 40% and Royal Dutch Shell Plc has dropped 50%.
Apple, meanwhile, has benefited as the pandemic has strengthened the market positions of the world’s biggest technology companies, which boast strong balance sheets and fast-growing businesses thanks to an acceleration in the shift to digital services. The iPhone maker’s shares have gained 45% so far this year.
Think your friends would be interested? Share this story!
