Apple $1,000,000,000,000

Apple Inc on Thursday became the first $1 trillion publicly listed US company, crowning a decade-long rise fueled by its ubiquitous iPhone that transformed it from a niche player in personal computers into a global powerhouse spanning entertainment and communications.

The company's Chief Executive Tim Cook said on the same day that the iPhone maker's $1 trillion market capitalization was "not the most important measure" of the company's success but was instead a result of its focus on its products, customers and company values, Reuters reported.

In a memo to Apple's more than 120,000 employees that was seen by Reuters, Cook called the valuation a "significant milestone" that gave the company "much to be proud of." But he said it should not be the company's focus.

"Financial returns are simply the result of Apple's innovation, putting our products and customers first, and always staying true to our values," Cook said in the memo.

With a closing price of $207.39 on Thursday, Apple became the first publicly listed US company to ever reach $1 trillion in market capitalization. Apple's stock market value is greater than the combined capitalization of Exxon Mobil, Procter & Gamble and AT&T. It now accounts for 4% of the S&P 500.

“The markets are starting to recognize the value of its platform and services more and more, and that’s what is being reflected in the increase in market capitalization,” said Brad Neuman, director of Market Strategy at Alger, a growth equity asset management firm in New York City.

Even with its $1 trillion stock market value, many analysts do not view Apple’s shares as expensive. Shares of Apple this week traded at about 15 times expected earnings, compared with Amazon at 82 times earnings and Microsoft at 25 times earnings.

Adjusting for four stock splits over the years, Apple debuted on the stock market for the equivalent of 39 cents a share on Dec. 12, 1980, compared with Thursday’s high of $208.38.

Apple was founded in the late 1970s by Steve Jobs and went public in 1980 after helping usher in the era of the personal computer. One of three founders, Jobs was driven out of Apple in the mid-1980s, only to return a decade later and rescue the computer company from near bankruptcy.

In the two decades since, Apple has risen to become the most valuable company in the world by helping popularize yet another era in computing, the smartphone. The iPhone, introduced by Jobs in 2007, has sold more than one billion units.

Cutthroat Competition

Hot on Apple’s heels is Amazon.com, the second-largest listed US company by market value, at around $880 billion, ahead of Alphabet Inc. with its $849 million market cap, and Microsoft Corp. at $818 billion, news outlets reported.

Apple won’t technically be the first publicly traded company to reach $1 trillion in market capitalization, as PetroChina earned that honor on the Chinese market more than a decade ago. The company’s valuation has come down sharply in the years since.

And Saudi Aramco, the Saudi Arabian state-owned oil giant, which reportedly intends to go public in 2019, was recently estimated to possess a valuation of about $2 trillion, according to the Financial Times.

Apple’s shares have been gradually climbing upwards. Last year, the company managed to cross $229 billion in sales. The company’s profits stood at $48.4 billion. These figures make Apple the most profitable listed US company.

Interestingly, the rally of the stocks was partially due to Apple’s decision of setting aside $100 billion to buy back its own stock. Tech insiders are attributing the latest achievement to the business acumen of CEO Tim Cook. Tech experts feel under Cook, Apple has managed not only to survive but thrive in an increasingly competitive market.

Symbolic Rise?

Apple's rise to a $1 trillion market cap is also symbolic of the evolution of what kinds of companies are most valued by investors, and society at large. Five of the 10 largest US companies by market cap on Thursday were tech companies, including Amazon, Alphabet and Facebook. In 2011, Apple was the only tech company in the top five.

The outcome, though, was not as certain as it appears now because market pundits were see-sawing till even a day back, with many laying bets on Amazon making the final cut.

One reason is that Amazon, which is also riding on the success of Amazon Web Services’ on-demand cloud computing platforms, has been tailing Apple for quite a while. Second, Apple’s own performance has not been exactly inspiring.