Top 25 global technology companies saw $1.4 trillion MCap added in Q2 2021, says GlobalData

Tech’s biggest companies ended Q2 with a bang. The top 25* added another $1.4 trillion in MCap in Q2 2021, according to GlobalData analysis, with the majority – a whopping $1.1 trillion – contributed by Facebook, Amazon, Apple, Microsoft and Alphabet/Google (FAAMG) stocks.

Keshav Kumar Jha, Business Fundamentals Analyst at GlobalData, comments: “Microsoft’s $2 trillion achievement was due to its increasing sales of enterprise cloud software during the COVID-19 health-crisis, besides the unveiling of a new version of the flagship operating system, Windows 11.”

Apple’s shares rebounded in Q2 after losing over 9% in valuation in Q1, 2021 in the wake of looming regulatory risks such as antitrust scrutiny worldwide.

Jha continues: “The iPhone maker announced a slew of updates for its flagship products, including iOS15, MacOS Monterey, watchOS 8, and many others at its Worldwide Developers Conference (WWDC 2021), which kept investor interest alive in the stock. Investors also seemed convinced about the company’s focus on exploring its iOS ecosystem to strengthen its software service business.

Amazon’s improved financial position, with a phenomenal increase of 220% in its net earnings in Q1 FY2021 over the same period in 2020, allowed the company to regain valuation in Q1 and rebound in the quarter ending June 30. Meanwhile, Alphabet and Facebook managed to win over investors’ confidence with their better-than-expected earnings performance and improved consumer engagement on their platforms.

Jha notes: “The dismissal of federal and state antitrust lawsuits against Facebook by a US judge helped the social media giant clock over $1 trillion MCap for the first time on 28 June, 2021.”

The valuation of Tencent fell as investors ditched the company amid the Chinese Government’s increased scrutiny.

Intel was the only semiconductor company that recorded double-digit decline in its MCap performance during Q2.

Jha continues: Investors shied away from Intel stock in the wake of its subdued financial performance in Q1 FY2021 and downward revision of its FY2021 outlook. Meanwhile, the company’s announcement of a delay in production of its next-generation Xeon data center processors at the later part of Q2 also didn’t go down well with investors and its stock fell 1.3% on 29 June, 2021.”

“Overall, the optimism surrounding economic recovery and improved earnings estimates of tech companies could keep the investors flocked to these stocks. However, uncertainty about the performance of major tech giants is likely to prevail due to the growing regulatory scrutiny around the world.”

*Technology companies include software and hardware developers, IT service providers (including internet-based service providers), and manufacturers of electronics, including semiconductors, mobile devices etc. GlobalData ranks the Top 25 companies based on MCap performance. Top 25 companies ranked by market capitalization (MCap).

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