Google parent company Alphabet has officially become the world’s most valuable company, knocking previous titleholder Apple down a peg. This is mostly due to Alphabet’s growing digital advertising business.
In the past year Alphabet has made a $4.9 billion profit, up from $4.7 billion from the year before. Its stocks have skyrocketed in value and the company itself is worth about $570 billion. Apple, in comparison, is worth around $535 billion. Like Alphabet, Apple’s past quarter was record breaking. However, it is also faced with dwindling smartphone sales, as less people have been buying iPhones in the past months. In the meantime, paid clicks on advertisements have increased 31 percent in the past year, sending Alphabet’s business surging forward.
“Alphabet had the combination of growth and transparency, which is the magic 1-2 combination in this market, while Apple is struggling through a bad hitting streak of soft growth,” Daniel Ives, managing director for FBR Capital Markets, was quoted as saying. “Investors are focusing on names like Alphabet hitting its stride while Apple has stumbled a bit out of the gates in 2016.”