Ever since the turn of the century, it has been predicted that data will eventually overtake oil and become the most valued asset. It seems that this moment has arrived as Apple has overtaken oil giant Saudi Aramco to become the world’s most valuable publicly-traded company with a market valuation of 1.84 trillion dollars on the back of strong third-quarter fiscal earnings.
Ever since Saudi Aramco’s market debut last year, it had been the most valuable publicly listed company. However, the pandemic has resulted in Apple overtaking the oil giant, as on Friday, its shares closed up by 10.47 per cent with its market valuation of a staggering 1.84 trillion dollars. Saudi Aramco has a market valuation of 1.76 trillion dollars.
Apple has registered an 11% year-over-year growth with its shares up by more than 44% this year. Morgan Stanley Analysts observed, “Despite Covid-19 headwinds, Apple grew revenue in every segment and geography, beating consensus revenue by 14 per cent as ecosystem engagement rises.”
The pandemic has caused a sharp slump in crude prices, considering the historically low demand, which has deeply affected Saudi Aramco. According to Bloomberg, in all probability, the company’s second-quarter revenue dropped to approximately $37 billion from $76 billion a year earlier.
While oil is currently out of favour, data has emerged as an undisputed king. Owing to the pandemic, people locked in the shelter of their homes consumed and generated more data than ever. Apple has aggressively strengthened its market positioning as it has gained the first mover’s advantage; thanks to its accelerated shift to the digital services.
It is important to note that in March, the gap between Apple and Saudi Aramco was more than $500 billion, which now Apple has leapfrogged.
The technology giant while continuing to aggressively push its most profitable lines of business in iPhone, iPad and Mac, has consciously diversified its portfolio as it sensed a slowing down of sales of its hardware devices.
Apple through Apple Music, Apple Card and the recently launched Apple TV+ is betting big on content and emerging as a strong competition to OTT giants like Netflix and Amazon Prime. This diversification is part of Apple’s plans to transform itself into one of the world’s leading providers of digital services.
Currently, the tech giant’s services segment makes up approximately 17.7% of its revenue.
Apple is betting big on data and is reaping the rewards for the same. It will not be far-fetched to say that data indeed is the new oil and technology is the new oil cartel.