This story ran in Thursday's Seattle Times.

It was the day a million iPads trumped a billion PCs.

On Wednesday, Apple passed Microsoft to become the world's most valuable technology company based on market capitalization.

While the two may end up trading positions for weeks and months to come, the unseating of the Redmond software giant captures the rise of consumer gadgets over workhorse corporate software.

Microsoft continually has dismissed Apple for its single-digit percentage of the PC market. With the launch of the iPod, iPhone and iPad, however, the Cupertino, Calif.-based company has continually dazzled Wall Street traders with the new, new thing.

Traders appear somewhat bored by Windows and Office, even if the software continues to rake in billions of dollars.

As Roger Sterling said in the TV show "Mad Men" about ad accounts, "Old business is just old business."

Microsoft stock fell 4 percent Wednesday to close at $25.01, which figures out to a market capitalization of $219.1 billion. Apple stock fell 0.5 percent to close at $244.11, giving the company a market capitalization of $222.1 billion.

Market capitalization is the share price times outstanding shares, a common measure of how much the stock market values a company.

"It's mostly symbolic," said Matt Rosoff, analyst at Directions on Microsoft, an independent research firm in Kirkland. "Apple built a lot of new businesses; they've been able to be successful in those businesses. They also started from a smaller base."

To compare the two company's financial performance, Microsoft had $14.6 billion in profit on $58.4 billion in sales in fiscal 2009. It says 1 billion people use Windows.

Apple had a profit of $5.7 billion on $36.5 billion in sales in fiscal 2009.

Microsoft is trading at a stock price 12.83 times earnings, also known as a price-to-earnings ratio. Apple's stock is trading at 24 times earnings.

The wide gap is a sign of Wall Street's faith in Apple's future potential earnings and that its stock will continue to leap and bound.

Microsoft's price-to-earnings ratio represents the sentiment that the company has less room to grow.

"Microsoft has a slightly slower growth profile that's reflected in the valuation," said Sid Parakh, analyst at McAdams Wright Ragen. His 12-month price target for Microsoft is $38 a share.

The drop in Microsoft's stock comes on the heels of Tuesday's news that two video-game veterans are leaving the company. Robbie Bach, president of the Entertainment and Devices division, is retiring, and J Allard, a senior vice president in the division, is leaving but will remain a consultant for Chief Executive Steve Ballmer.

The company's stock had been dropping through May after trading near a 12-month high in April.

Apple and CEO Steve Jobs have been riding a high, launching the iPad tablet device in April and selling 1 million units since. The iPad represents a triumph of sorts over Microsoft, which had the head start many years ago with its work on tablet PCs.

Going back over the past decade, though, Microsoft's stock has hovered between $24 and $34 a share, while Apple's stock has risen from less than $10 to more than $200 a share.

In 1997, Microsoft stepped in to help Apple with a $150 million investment, when its rival was trading at $7 a share.

"Microsoft stock price has pingponged for the past 10 years. It hasn't really gone up or down," Rosoff said. "Apple's has gone up significantly."

Analysts say the market capitalization will not fundamentally change how Microsoft will do business. The company declined to comment, but executives have said in the past that all they can do is focus on execution, not the stock market.

"I don't think the notion of their market cap being slightly lower than Apple's is going to fundamentally drive how they run that business," Parakh said.

The only thing Microsoft can do is to make products that consumers like, such as Windows 7, he said. "Clearly it just boils down to long-term strategy execution."

Update 11:41 a.m.:

The gap had narrowed again as of mid-day Thursday.

Microsoft stock is up a few percentage points in intraday trading to $26 per share, pushing its market capitalization up to $228 billion and closing the gap with Apple. Shares of apple were also up a few percentage points to around $252, making its market capitalization $229.4 billion.

Update 2:58 p.m.:

Apple ended Thursday ahead of Microsoft with a market cap of $230.5 billion compared to Microsoft's $227.9 billion.

Microsoft shares rose 4 percent to close at $26 and Apple shares increased 4 percent to $253.35.

Sharon Pian Chan: 206-464-2958 or schan@seattletimes.com. Follow me on Twitter @sharonpianchan