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Apple became the first U.S. company to hit a $2 trillion valuation on Wednesday, just two years after it was the first to cross the $1 trillion mark.
The achievement is all the more impressive given the circumstances: Amid market turmoil back in March, Apple's valuation plunged 30% from its February highs, dipping below $1 trillion. But with investors seeing it as a safe haven amid general pandemic uncertainty, it bounced back — and then some.
In fact, Apple — along with other Big Tech stocks from Google, Microsoft, Amazon and Facebook — has helped the entire stock market bounce back. Credit Suisse data suggests that those five stocks soared 37% between January and August, compared to a 6% drop for the rest of the S&P 500.
That two-tier economy has some people worried. Earlier this summer, Haskayne School of Business professor Anup Srivastava told Protocol that Big Tech companies need a healthy economy to survive. "A salesperson makes money when things get sold," he said, noting that Facebook and Google rely on small businesses for their advertising revenue. Apple, meanwhile, needs consumers that are able to spend $1,000 on the latest iPhone — a shrinking group of people, given the recession.
But for now, investors seem not to care. As The Wall Street Journal's Dan Gallagher points out, Apple's stock is trading at around double the price-to-earnings multiple it was when it hit $1 trillion. That means investors are willing to pay an awful lot for its stock, even with threats like antitrust regulation and potential threats to its Chinese business lurking on the horizon. Time will tell if those actually slow Apple down — or if $3 trillion is just around the corner.