When considering which technology stocks will produce the highest returns, it is better to invest in innovative companies that will be major players for decades to come rather than the next few quarters. Amazon (AMZN -0.54%), Apple (AAPL -0.66%)Y Microsoft (MSFT -0.97%) Each has undoubtedly changed technology as we know it, founded by leaders with a well-trained eye on the future.
As a result, these companies continue to produce revolutionary products and services and are likely to do so for years to come. This is why.
Amazon revolutionized e-commerce when it was founded in 1994, starting with selling music and videos, then moving on to books and hundreds of other products. The company then shook up the industry again with the launch of Amazon Prime in 2005. The subscription service has amassed 163.5 million users in the US, about 49% of the population.
Amazon has earned a reputation for disrupting well-established industries with superior technology and aggressive investment. His foray into books led him to take on publishers and booksellers around the world, offering a cheaper and faster way to buy literature. So he took over Sony, Apple and Samsung with their launch of e-readers and tablets. His recent acquisitions of one doctor Y I robot you can see Amazon doing the same thing again in the healthcare and consumer robotics industries.
Additionally, Amazon Web Services (AWS) has become a cloud computing titan, with a commanding 34% market share in the $203.5 billion industry. Launched in 2006, AWS hosts applications and websites for businesses, universities, and government agencies around the world. As a result, AWS accounted for 13% of Amazon’s revenue in the last quarter of 2021 and 100% of its operating income.
Amazon has proven time and time again that it is a force to be reckoned with, no matter the industry. It is likely that it will continue to grow and revolutionize the world of technology in the coming years.
Apple is arguably the most innovative company in the world, not necessarily because of being the first to introduce a product, but because of its unique talent for reinventing technology and pushing it into the mainstream. In 2007, Apple released the first iPhone, catapulting smartphones into the stratosphere and prompting dozens of other tech companies to create similar devices. The tech giant did the same thing with the tablet when it introduced the iPad in 2010 and convinced millions of consumers to wear a smartwatch when it launched the Apple Watch in 2016.
Furthermore, Apple has developed a winning strategy with its products. Its ecosystem of interconnected devices offers ease of use for consumers and implies a model where users go further into their walled garden through a single product. For example, iPhone users are more likely to look for a MacBook when buying a laptop or an iPad when they need a tablet simply because the devices work so well together natively.
As of September 5, iPhone surpassed Android smartphones in the US, reaching 50% market share for the first time. The achievement is a positive for Apple because more iPhone users means more people to attract to its other products.
Apple tends to keep a tight lid on its unannounced projects, but rumors have swirled that it has plans to enter other markets, such as virtual reality, electric vehicles and foldable phones. If we go by the past, these industries will change dramatically once Apple arrives.
Since the creation of Windows software in the 1980s, Microsoft has dominated the market for desktop computers and, later, laptops. Despite the best efforts of companies like Apple to capture market share from Microsoft, the Windows maker has maintained a tight grip on the PC operating system market. Apple has used an aggressive strategy for the past decade, but Windows still accounts for more than 76% of the PC software market.
That number increases significantly when it comes to games. Windows operating systems account for more than 96% of the PC gaming market on the largest platform, Valve’s Steam.
In recent years, Microsoft has been combining its Xbox console and Windows PC gaming businesses. Blurring the lines between the two has led to considerable success with his Netflix-such as the game subscription service, Xbox Game Pass. The service is the world’s most popular gaming subscription, growing from 10 million members in 2020 to 25 million in early 2022.
As Microsoft aggressively acquires game developers and publishers, the company is in a prime position to lead the future of the games industry, much like Netflix did with the movie industry for the past decade. In addition, its planned acquisition of Activision Blizzard in 2023 will make it the third largest game company by revenue after Tencent and Sony and give it the power to enact more changes in the industry.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. dani cook has no position in any of the mentioned stocks. The Motley Fool has positions and recommends Activision Blizzard, Amazon, Apple, Microsoft, Netflix and Tencent Holdings. The Motley Fool recommends the following options: $120 long calls in March 2023 at Apple and $130 short calls in March 2023 at Apple. The Motley Fool has a disclosure policy.