Tags: Google | Exxon | search | Internet

Google Passes Exxon to Become Second-Most Valuable US Company

Friday, 07 Feb 2014 01:55 PM

 

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Google Inc. surpassed Exxon Mobil Corp. as the second-most valuable U.S. company, trailing only Apple Inc. and underscoring the growing role of technology in the economy.

Google, which became the world’s largest online advertiser through its dominant search engine, has a market capitalization of $393.5 billion while oil company Exxon is valued at $392.6 billion, according to data compiled by Bloomberg. Apple has a market value of $465.5 billion. Software company Microsoft Corp. is No. 4 with $302.1 billion.

Technology companies are establishing themselves as key players worldwide as they disrupt industries from retail to finance. Google, which went public in 2004, 84 years after Exxon, has benefited from consumers moving to online services and content, a trend that’s being accelerated by the growing popularity of smartphones and tablets.

Exxon, the world’s largest oil producer by market value, has been under pressure since it reported fourth-quarter output declined last month. Net income fell 16 percent to $8.35 billion, or $1.91 a share. Sales dropped 3.3 percent to $110.86 billion. Global output for the Irving, Texas-based company dropped for the ninth time in 10 quarters.

Google fared better in its fourth quarter. Last month, it reported that revenue, excluding sales passed on to partners, rose 11 percent to $13.6 billion, topping projections of $13.4 billion, amid a busy holiday shopping season.

While shares of Exxon have fallen more than 11 percent this year, Google’s are up 3.5 percent through yesterday.

Google’s Rise

Google began as a simple search engine when co-founders Larry Page and Sergey Brin found a better way to sift through the exploding amount of information on the Internet. In the following years, the Mountain View, California-based company added online services such e-mail, maps and calendars.

More recently, the company has shown it’s willing to venture further from its early roots with bets on software for mobile phones, fiber networks and entertainment content. It’s also investing in much longer-term projects, such as driverless cars, robotics and balloon-enabled wireless services.

Google has retained its leadership in online advertising. The company is expected to take 41 percent of the U.S. digital-ad market this year with the closest No. 2, Facebook Inc., grabbing just 8.2 percent, according to EMarketer Inc.

© Copyright 2014 Bloomberg News. All rights reserved.

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