Microsoft stock rose Tuesday on news related to its artificial intelligence initiatives, while fellow megacap stock Apple dropped on worries about iPhone sales weakness in China.
Microsoft and Apple are battling for the title of the world's largest company by market capitalization. On Tuesday, Microsoft's market cap surpassed Apple's. Microsoft ended the regular session with a valuation of $2.9 trillion, vs. Apple's $2.856 trillion, according to IBD MarketSmith.
On the stock market today, Microsoft stock advanced 0.5% to 390.27. But Apple stock retreated 1.2% to 183.63.
Apple stock dropped on news that the company is offering discounts on its newer iPhones in China to spur demand. Apple often discounts products for the Lunar New Year, but hasn't done so for new iPhones in years.
Microsoft Stock Climbs Higher
Microsoft stock got a lift from news of a strategic partnership and expansion of its Copilot offerings.
On Tuesday, Microsoft and U.K.-based Vodafone announced a 10-year strategic partnership to bring generative AI and cloud services to more than 300 million businesses, public sector organizations and consumers across Europe and Africa.
Vodafone will invest $1.5 billion over the next 10 years in cloud and customer-focused AI services developed with Microsoft. Those services include Microsoft's Azure OpenAI and Copilot offerings.
Also, Vodafone will replace its physical data centers with cheaper and scalable Azure cloud services.
Meanwhile, Microsoft plans to invest in Vodafone's managed Internet-of-Things connectivity platform, which will become a separate, stand-alone business by April 2024.
Copilot Opened To More Users
In other Microsoft news, the Redmond, Wash.-based software giant announced moves to expand the reach of its Copilot AI assistant software to consumers and small businesses.
Microsoft announced a paid version of its Copilot platform for individuals. The service, called Copilot Pro, will cost $20 per month per user and includes advanced capabilities not available in the free version.
Plus, Microsoft said it is dropping the minimum user requirement for Copilot for Microsoft 365. Microsoft previously limited the offering to companies purchasing licenses for 300 seats or more. The change will open up the service to small and medium size businesses. That service costs $30 a month per user.
Microsoft Stock In Buy Zone
On Jan. 11, Microsoft stock broke out of a flat base at a buy point of 384.30, according to MarketSmith charts. The 5% buy zone extends to 403.52, based on IBD trading principles.
Meanwhile, Apple stock tripped sell signals on Jan. 2 after diving below its 50-day moving average line. Apple stock notched an all-time high of 199.62 on Dec. 14.
Follow Patrick Seitz on X, formerly Twitter, at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
