Amazon on Tuesday joined Apple, to become the second $1 trillion value company in the United States.
The online retail company attained the threshold after its stock price doubled in 15 months. iPhone maker, Apple, had reached the $1 trillion value on August 2.
According to reports, Amazon’s valuation will surpass that of iPhone in a matter of time, if its share price continues at the recent pace.
In comparison, it took Apple almost 38 years as a public company to achieve the trillion dollar milestone, while Amazon got there in 21 years. Though Apple’s iPhone and other devices remain popular and its revenues growing, it is not keeping up with Amazon’s blistering sales growth.
Amazon has reportedly impressed investors by successfully diversifying its business into virtually every area of the retail industry–redefining how consumers buy products and putting pressure on many stores with physical structures.
It also provides video streaming services and bought upscale supermarket Whole Foods. Also, its cloud computing services for companies have become a major driver of earnings and revenue.
Daniel Morgan, portfolio manager at Synovus Trust in Atlanta, Georgia, said: “Amazon’s a little bit more dynamic than Apple because the iPhone has become more mature. Amazon’s cloud business is an extra growth driver that Apple doesn’t have.”
David further described Amazon’s cloud services as its “crown jewel.”
In the second quarter of the year, its cloud services accounted for 55 percent of its operating income and 20 percent of total revenue, according to Morgan.
Apple started business in December 1980, but its stock did not increase until after 25 years. It was engineered by iPhone; the breakthrough device that left competitors scrambling.
Amazon was founded as an online book-retailer in Chief Executive, Jeff Bezos’ garage in 1994. It started trading on May 15, 1997, at $1.50.
By October 2009, it had risen to $100 and the stock rose to $1,000 for the first time on May 30, 2017. The shares rose to $2,000 for the first time ten months after, with just $50 per share away from making the company a $1 trillion market value.
The shares were last up 1.1 percent at $2,035.69, pulling back slightly from the milestone level of $2050.2677.
Amazon currently trades up 74.0 percent for the year to date. In comparison, Apple has only risen by 34.7 percent year to date.
Analysts say they expect Apple’s revenue to jump 14.9 percent in its fiscal year ending in September. According to Thomson Reuters data, it will be a massive rise, but still far short of Amazon’s expected revenue growth of 32 percent.