Google Dethrones Apple As World's Most Valuable Company - But Facebook Is Gaining

A year ago Apple bestrode the world like a proverbial colossus: dominant, omniscient, untouchable. But the path to perfection is littered with the skid marks of companies like GE, Exxon, IBM and Microsoft who were also believed to be the greatest ever. Until they weren't.

Even Google cannot enjoy what may be its nanosecond in the sun: Facebook is gaining on it, thanks to its performance in mobile. It is ironic that Apple's success with the iPhone may ultimately be seen as its undoing, since strategic devotion to one platform, especially in hardware, tends to cloud one's vision about potential threats and benefits. Ask Intel.

The reality is that while biggest is noteworthy, it is not necessarily representative of best - and certainly not indicative of anything remotely like longevity. These three companies, and possibly even newer comers like Uber, are going to be battling it out for supremacy for a long time. The challenge is assuring that the operational cost of achieving that scale does not outweigh the reputational benefits, since the former may last far longer than the latter. JL

Melvin Backman reports in Quartz and Steven Russolillo reports in the Wall Street Journal:

Google’s parent company, Alphabet, is now bigger than Apple—and every other publicly traded company on Earth. The company’s market value appears to be somewhere in the general ballpark of $560 billion, enough to overtake Apple’s $535 billion. As with Facebook, a key question around Google is how successful its search and advertising businesses are on mobile.
Quartz

Google’s parent company, Alphabet, is now bigger than Apple—and every other publicly traded company on Earth.

Alphabet’s just-reported earnings sent the search giant’s shares surging in after-hours trading. With Alphabet’s Class A shares trading at more than $810 each after the close, the company’s market value appears to be somewhere in the general ballpark of $560 billion, that’s more than enough to overtake Apple’s nearly $535 billion market value, according to FactSet.

The two companies have been nearing this moment for months, after long stretch where Apple’s value towered over that of Google.

Alphabet has seen its fortunes rise on the back of massive growth in its core advertising business, even as it continually draws attention for its projects in everything from self-driving cars to artificial intelligence. It reported as Alphabet, and not Google, for the first time ever today, part of a restructuring that started in August of last year.

Apple, on the other hand, has seen its fortunes reverse, as the handset market matures in developed markets and the emerging markets that Apple was looking to for growth are facing economic headwinds. Sure, it has a pretty cool music service, plans for electric cars and some wireless chargers in the works. But that hasn’t been enough to keep alive the investor enthusiasm that propelled it past Exxon Mobil to become the world’s largest company back in 2011.

Wall Street Journal

In the continuing battle for world domination, a cool $15 billion separates Google parent Alphabet Inc. from Apple Inc.
Wall Street has cheered Facebook's recent mobile success. Last week, Facebook said some 80% of total fourth-quarter advertising revenue came from mobile, well ahead of estimates and up from 23% three years ago.
As with Facebook, a key question around Alphabet's Google is how successful its search and advertising businesses are on mobile.
Google last year said search traffic on phones surpassed desktop traffic world-wide. According to an eMarketer estimate, Google had roughly 33% of global mobile Internet ad revenues in 2015. That is ahead of Facebook, which the firm estimates had around 17% of the total.
But Facebook has been quicker to pivot toward mobile, which could help it gain ground on Google. For example, eMarketer estimates that Google's net mobile Internet ad revenue will rise to about 70% of total net ad revenue by 2017, up from just under 50% in 2015. That is a brisk pace, but not as brisk as Facebook's. Agility is important given debate over whether the future of mobile will be through the web or apps.
Meanwhile, Google's growth in total advertising revenue has leveled off.
Some could argue investors are assuming Google will do fine. The stock is up by more than one-third in a little over six months. Its valuation, at around 22 times forward earnings, isn't far off highs of the past five years.
Gains have come in part thanks to a new emphasis on cost control, hopes for capital returns and transparency the company is promising. Maintaining progress, though, will depend on being fleet of foot in mobile.