What are the top technology stocks? Here’s an overview of the 10 top companies listed in order of market cap for investor consideration.
According to Deloitte, businesses are increasingly adopting cloud and artificial intelligence (AI) capabilities into their business models. An estimated 60 percent of these organizations moved to the cloud in 2019, boosting the top technology stocks.
A number of the largest tech companies, including Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN) and IBM (NYSE:IBM), are scaling up their cloud offerings. In turn, profit and revenue from cloud sales are driving growth. Cloud services often provide a monthly recurring revenue stream for businesses.
In 2019, Microsoft passed a US$1 trillion market cap valuation, emerging as the largest tech stock in the world as an uptick in its cloud sales bolstered its earnings and stock price.
Microsoft is not the first to reach these gargantuan valuations. In August 2018, Apple (NASDAQ:AAPL) became the first publicly traded company to reach the US$1 trillion valuation mark. Shortly after, Amazon surpassed this mark. Statista states that Amazon’s market share of the US ecommerce market is anticipated to reach a whopping 50 percent by 2021.
Deloitte further notes that the tech industry is projected to focus more significantly on cloud computing and flexible consumption (“pay as you go”) services looking forward. Additionally, distributed ledger and blockchain technology are continuing to be large tech trends, and Deloitte has projected that more businesses will explore integrating blockchain applications into their business models.
As security issues increase in scale, the application of blockchain and biometrics may be effective solutions for privacy protection.
Top technology stocks
Below the Investing News Network takes a look at the largest tech companies globally according to market capitalization. Data was sourced from intelligence company Global Data, with the top 10 companies in the technology sector listed in order from largest market cap to smallest. All numbers and figures for the technology companies were gathered on November 17, 2020.
1. Apple (NASDAQ:AAPL)
Market cap: US$2.08 trillion
First on our top technology stocks list is Apple. Since the company shot to fame with the Macintosh in 1984, Apple’s hardware portfolio has expanded to include the iPad, Mac, Apple Watch and Apple TV. Its digital services also include App Store, Apple Music, Apple Pay and iCloud. At the end of 2019, Apple officially acquired the lion’s share of Intel’s (NASDAQ:INTC) chip business for US$1 billion.
2. Microsoft (NASDAQ:MSFT)
Market cap: US$1.63 trillion
Founded in 1975 with its headquarters in Redmond, California, Microsoft is well versed in hardware and software. Its hardware lineup consists of its flagship Surface brand, which covers a wide range of price points. The line is a competitor for Microsoft’s arch rival — Apple’s iPad Pros and Macbooks.
The company’s software portfolio has always been a strong focus, and includes its computer operating system, smartphone operating system and Windows Server. Furthermore, Microsoft has been targeting business users with its productivity suite, which includes the Office and Cloud suites. Azure, its cloud product, has driven considerable year-over-year revenue growth.
3. Amazon (NASDAQ:AMZN)
Market cap: US$1.58 trillion
Founded in 1994, Amazon has evolved from an online retailer to become a tech monolith through its Amazon Web Services (AWS) platform. AWS offers services for computing, storage, databases, networking, analytics, machine learning and AI, among other things.
Fire TV, Amazon’s streaming platform, had 40 million active users in January 2020. In addition, the company’s virtual assistant, Alexa, became available in India, France, Spain, Australia and Japan.
4. Alphabet (NASDAQ:GOOG)
Market cap: US$1.2 trillion
Alphabet, the holding company of internet search giant Google, operates through multiple brands, with its portfolio of companies ranging from investments to acquisitions. Some of the companies under Alphabet are Calico, GV, Capital G, Verily, Waymo, X and Google Fiber. As such, it’s no surprise that Alphabet ranks highly on the top technology stocks list.
Founded in 1998, Google quickly became a household name with numerous products under its vertical. The list now includes Google Pay, Google Cloud, Android, Google Maps and YouTube.
Most recently, Alphabet became the newest member of the trillion-dollar club when its market cap officially climbed over US$1 trillion on January 16, 2020.
5. Facebook (NASDAQ:FB)
Market cap: US$782.17 billion
Social media giant Facebook occupies the fifth spot, with its product suite connecting more than a billion users across the globe.
The company’s products include Facebook, Instagram, Messenger, WhatsApp and Oculus. During the third quarter of 2020, daily active users on Facebook numbered 1.82 billion, while its monthly active users were 2.7 billion.
6. Tencent Holdings (OTC Pink:TCHEY,HKEX:0700)
Market cap: US$723.45 billion
Founded in 1998, Tencent Holdings is a technology company that invests in a wide range of internet-related businesses with an enormous global footprint.
Tencent owns subsidiaries and products that number into the hundreds, including Activision Blizzard (NASDAQ:ATVI), Fortnite, Riot Games and Take-Two Interactive Software. In addition, the company owns China’s largest messaging app, WeChat.
Tencent became the first Chinese tech company to land a valuation of over US$500 billion in 2017. More recently, it was revealed that Tencent has entered into a new capital investment with its funding of Platinum Games. This move comes on the heels of Tencent’s distribution deal with Nintendo (OTC Pink:NTDOF,TSE:7974) in December 2019. The companies announced that Tencent would operate as the authorized distributor of the Nintendo Switch gaming handheld system in China.
7. Taiwan Semiconductor Manufacturing (TSM) (NYSE:TSM)
Market cap: US$501.39 billion
Created in the late 1980s, TSM was originally created to be a semiconductor innovator across the globe. Since then, TSM has spawned an entire tech division that focuses on automotive technology, AI and 5G applications, wearable technology and mobile platforms.
In January 2020, the company announced that it reached revenue of 317.24 billion New Taiwan dollars and net income of $116.04 billion New Taiwan dollars during the fourth quarter of the previous year. Revenue increased 9.5 percent from Q4 2018 and net income climbed 16.1 percent.
8. Samsung Electronics (KRX:005930)
Market cap: 440.62 billion South Korean won (approximately US$398.79 billion)
With headquarters in Seoul, South Korea, Samsung Electronics is the eighth largest tech company in the world. Founded in 1938, Samsung originated as a grocery trading store. The company then focused on the textiles industry after the Korean War, and in 1969 it first entered into the electronics industry. It is now among the largest electronics manufacturers in the world.
In addition to products such as tablets, smartphones, watches and even appliances, Samsung operates a semiconductor business, developing chips and smartphone application processors.
9. NVIDIA (NASDAQ:NVDA)
Market cap: US$330.54 billion
NVIDIA, the inventor of the graphics processor unit (GPU), creates interactive graphics on laptops, workstations, mobile devices, notebooks, PCs and more. The company’s major competitors are Advanced Micro Device (NASDAQ:AMD), Intel (NASDAQ:INTC) and Qualcomm (NASDAQ:QCOM).
Alongside GPUs, NVIDIA offers processing capabilities to scientific researchers with supercomputing sites across the globe. The primary arms of NVIDIA’s business model are in gaming (including its cloud gaming service GeForce Now), automotive electronics, mobile devices and more recently artificial intelligence.
In response to the COVID-19 pandemic, Nvidia announced in mid-2020 the development of an “open-source ventilator that can be built with US$400 in readily available parts.”
10. Adobe (NASDAQ:ADBE)
Market cap: US$223.62 billion
Adobe is a software-as-a-service heavyweight in the global tech market. A pioneer in the creation of the desktop publishing, the company is best known for its flagship product, Photoshop.
Adobe’s product portfolio includes dozens of applications across its Creative, Document, and Marketing Cloud platforms. The company’s business model includes generating predictable cash flows through subscriptions. In November 2020, Adobe announced the acquisition of marketing workflow startup Workfront for US$1.5 billion.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.