The title of most valuable company in the world no longer belongs to Apple, and the crown has not gone back to previous record holders, Microsoft, Google or Amazon. Saudi Aramco, the world’s largest crude oil exporter, took the top spot from the tech giant. It was ranked the 4th most valuable company last year and is 94% owned by the Kingdom of Saudi Arabia (which strangely also owns most of SNK).
According to a report in Financial TimesApple lost its position despite being the first company to reach a market cap of $3 trillion in January.
Apple suffered 19% losses and its share price dropped to $146 (the lowest since November 2021) after hitting the $3 trillion mark. Apple is currently valued at $2.37 trillion. Aramco managed to surpass it with a market cap of $2.43 trillion. Apple is still the most valuable company in the US, with Microsoft topping $1.95 trillion.
Apple CEO Tim Cook blames supply shortages and Covid-related lockdowns in China for costing the company at least $8 billion this quarter alone. Despite these challenges, Apple still managed to have its third best quarter in revenue.
Saudi Aramco shares are up nearly 30% since the new year. The soaring oil prices only helped the Crown-owned energy company: this quarter alone there was an 82% increase in last year’s profits by about $40 billion dollars.
The current price of a barrel of oil is $139, the highest in 14 years, and countries that have turned away from Russian oil since the Ukraine invasion are buying more and more from Saudi Arabia.
It makes sense to see tech companies take a hit while energy companies make record profits, especially during these turbulent times. But Apple can easily take back its crown once the supply chain issues are resolved.
“You can’t compare Apple to Saudi Aramco in terms of business or fundamentals, but the outlook for the commodities space has improved,” said James Meyer, CIO of Tower Bridge Advisors. Bloomberg. “They are the beneficiaries of inflation and tight supply.”