In the tech world, fortunes can turn in a flash.
During the 1990s, Microsoft enjoyed explosive growth thanks to the popularity of its Windows operating system for personal computers.
Microsoft looked unbeatable until it wasn’t. Its market cap peaked during the dot.com bubble, then slumped and drifted for years.
By the mid-2000s, Microsoft (MSFT) seemed stuck in the mire.
Meanwhile, Apple (AAPL) started to take consumers by storm with the launch of its iPod, iPad and iPhone franchises.
More broadly, the growth of desktop PC sales started to slow as the action shifted more to high-powered tablets and smartphones.
Apple’s market value took off even as investors became more disenchanted with Microsoft.
Flash forward to 2018: Under the leadership of Microsoft CEO Satya Nadella, the company is now enjoying a major comeback, thanks to the growth of its cloud computing business.
Its PC-related business is also enjoying surprising growth.
As a result, Microsoft’s market value is now nose-to-nose with that of Apple.
Another way to examine the competitive dynamics between Apple and Microsoft is to look at the spread between the two companies’ market caps going back to 1986.
That’s what the analysts at Bespoke Investment Group did in the chart below: Apple’s market value has really slumped in recent months, while Microsoft has bounded from strength to strength.