Microsoft has emerged as a potential winner, surpassing Apple as the most valuable company globally with a market capitalization of close to $3tn. The shift to AI and cloud computing is expected to add $25bn to Microsoft's revenues by 2025. Despite job cuts, the tech industry is seen as entering a bull market, with companies that adapt to the AI revolution expected to thrive.
Key takeaways:
- There have been more than 7,500 layoffs in the tech sector since the start of 2024, with companies like Google, Amazon, and Meta making significant cuts. However, these are seen as a necessary part of reorganising around cloud computing and AI.
- Despite the layoffs, some analysts predict strong numbers for the tech sector as the earnings season begins, suggesting the start of a tech bull market. They believe the industry has cleared out its pandemic-era overhiring and is now focusing on more promising sectors.
- Microsoft has surpassed Apple as the most valuable company globally for the first time since 2021, with a market capitalisation of close to $3tn. Microsoft's lead in AI could potentially add $25bn to the company's revenues by 2025.
- Analysts predict an increase in demand for enterprise software and cybersecurity, and a surge in demand around major AI projects. They believe the AI revolution will continue to gather momentum, with companies like Nvidia and Microsoft leading the way in AI monetisation.