Launched in 1985, the Nasdaq-100 (NDX) is a modified capitalization weighted index that tracks the largest non-financial companies listed on the Nasdaq Stock Exchange. The Nasdaq-100 Index brings together innovation, high growth, diversity, global appeal and liquidity in one basket, which makes it ideal for any investor's core portfolio.
Here’s a closer look at the top ten constituents of the Nasdaq-100 Index.
Apple, Inc. (AAPL)
Apple became the first publicly traded U.S. company to hit a $1 trillion market cap in August 2018. Two years later, in August 2020, it touched the $2 trillion valuation, and this year in June, Apple briefly touched the $3 trillion market cap during trading hours. Apple has repeatedly said, “Our objective is to make great products and services that enrich people's lives and to provide an unparalleled customer experience so that our users are highly satisfied, loyal and engaged. As we accomplish these objectives, strong financial results follow.” Apple reported a revenue of $274.51 billion in FY2020 and $365.82 billion in FY2021 (October 2020 – September 2021). During the nine months of FY2022 (October 2021 – June 2022), the company reported a revenue of $304.18 billion. Apple spent 6% of its net sales on research and development in FY2021.
Microsoft Corporation (MSFT)
Microsoft, under the leadership of its CEO Satya Nadella, has been working under the renewed vision for a “mobile-first, cloud-first, data-powered world.” In FY2022 (July 2021 – June 2022), Microsoft delivered $198.3 billion in revenue, up 18% year-over-year from $168.08 billion in FY2021. Its operating income grew 19% to reach $83.4 billion. Cloud has a growth driver for the company in recent times. With research and development efforts, initiatives and partnerships, Azure has more than doubled its worldwide market share from 10% in 2014 to 22% in 2022. During Q4 FY2022, Microsoft Cloud surpassed $25 billion in quarterly revenue for the first time, up 28% and 33% in constant currency. Microsoft has acquired around 227 companies since 1994. In recent years, MSFT has made key acquisitions to help bolster its cloud services.
Alphabet, Inc. Class C & Class A (GOOG, GOOGL)
Alphabet is a collection of businesses, the largest of which is Google. The company’s earnings are reported under three segments—Google Services, Google Cloud, and all non-Google businesses collectively as Other Bets. Other Bets include earlier stage technologies that are further afield from the company’s core Google business. Over the past few years, Google has intensified its efforts to catch up with the leaders in Cloud computing. A lot has been achieved, and today, Google Cloud ranks third, after Amazon AWS and Microsoft Azure with a 10% market share. During FY2021 (January 2021 – December 2021), Alphabet reported a revenue of $257.64 billion vis-à-vis $182.53 billion in FY2020. During Q2 FY2022, Google Cloud surpassed the $6 billion quarterly revenue mark for the first time. Overall, a revenue of $69.7 billion was reported, up 13% versus last year or 16% on a constant currency basis.
Amazon.com, Inc. (AMZN)
The company once said: “We believe that a fundamental measure of our success will be the shareholder value we create over the long term. This value will be a direct result of our ability to extend and solidify our current market leadership position.”
While this is an excerpt from Amazon’s 1997 shareholder letter, it remains true till today. Amazon is the undisputed leader in e-commerce in the U.S., dominating 39.5% of the market share in 2022. The U.S. e-commerce market is expected to cross the $1 trillion mark for the first time in 2022. In addition to e-commerce, another market segment which Amazon continues to lead is Cloud. Amazon’s AWS currently captures 33% of the Cloud market. During FY2021 (January 2021 – December 2021), Amazon’s net sales increased 22% to $469.8 billion, compared with $386.1 billion in 2020.
Tesla, Inc. (TSLA)
Founded in 2003, Tesla is almost a synonym to electric cars. The company dominates 60.9% of the U.S. BEV market according to July numbers by Morgan Stanley. Tesla’s revenue swelled by 71% from $31.53 billion in FY2020 to $53.82 billion in FY2021 (January 2021 – December 2021). During Q2 FY2022, Tesla reported a total revenue $16.9 billion, growing 42% year-on-year on the back of growth in vehicle deliveries, increased average selling price (ASP), and growth in other parts of the business. Tesla builds not only all-electric vehicles but also infinitely scalable clean energy generation and storage products. In 2021, the global fleet of Tesla vehicles, energy storage and solar panels enabled its customers to avoid emitting 8.4 million metric tons of CO2e.
Meta Platforms, Inc. (META)
In October 2021, Facebook’s name was changed to Meta. Since its foundation in 2004, Facebook changed the way people connect, and the change in name captures the company’s vision.
Mark Zuckerberg wrote in a letter: “In our DNA, we build technology to bring people together. The metaverse is the next frontier in connecting people, just like social networking was when we got started.”
The company has laid much emphasis on Augmented Reality (AR) and Virtual Reality (VR), and in August 2020, it introduced a new name for its AR/VR team—Reality Labs. In Q4 FY2021, Meta added reporting on two operating segments: Family of Apps (FoA) and Reality Labs. In FY2021 (January 2021 – December 2021), Meta posted a revenue of $117.93 billion vis-à-vis $85.96 billion in FY2020. FoA includes Facebook, Instagram, Messenger, WhatsApp and other services. Reality Labs includes AR- and VR-related consumer hardware, software and content.
NVIDIA Corporation (NVDA)
NVIDIA has been a pioneer in accelerated computing. The company’s invention of the GPU in 1999 sparked the growth of the PC gaming market, redefined computer graphics, and ignited the era of modern AI. Today, NVIDIA is a full-stack computing company with data-center-scale offerings that are reshaping the industry. During FY2022 (February 2021 – January 2022), the company’s revenue stood at $26.92 billion as compared to $16.67 billion in FY2021. The four major segments highlighted in NVIDIA’s earning report are gaming, data centers, professional visualization, and automotive. NVIDIA recently reported its Q2 FY2023 earnings with its revenue at $6.70 billion, up 3% from a year ago, and down 19% from the previous quarter. “NVIDIA has excellent products and position driving large and growing markets. As we navigate these challenges, we remain focused on the once-in-a-generation opportunity to reinvent computing for the era of AI,” said Jensen Huang, founder and CEO of NVIDIA.
PepsiCo, Inc. (PEP)
PepsiCo’s foundation goes back to 1965. Today, its products are consumed in more than 200 countries and territories around the world. PepsiCo's product portfolio includes a wide range of enjoyable foods and beverages that generate more than $1 billion each in estimated annual retail sales. PepsiCo generated $79 billion in net revenue in FY2021 (January 2021 – December 2021). PepsiCo’s portfolio includes Lay's, Doritos, Cheetos, Gatorade, Pepsi-Cola, Mountain Dew, Quaker, and SodaStream. During Q2 FY2022, the company reported $20.22 billion as its net revenue for the quarter. PepsiCo became a component of the Nasdaq-100 Index in July 2018.
Costco Wholesale Corporation (COST)
Costco Wholesale is a multi-billion-dollar global retailer. The company currently operates 834 warehouses, including 575 in the United States and Puerto Rico, 107 in Canada, 40 in Mexico, 31 in Japan, 29 in the United Kingdom, 16 in Korea, 14 in Taiwan, 13 in Australia, four in Spain, two each in France and China and one in Iceland. Costco also operates e-commerce sites in the U.S., Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan and Australia. Its revenue was reported at $195.93 billion in FY2021 (September 2020 – August 2021) vis-à-vis $166.76 billion in FY2020. For the forty-eight weeks ended July 31, 2022, of the ongoing FY2022, the company reported net sales of $205.19 billion, an increase of 16.4% from $176.30 billion during the similar period last year.
Some of the other prominent names that make up the index are Cisco (CSCO), Qualcomm (QCOM), Intel (INTC), Micron (MU), Adobe (ADBE), Advanced Micro Devices (AMD), Gilead (GILD), Regeneron (REGN), Vertex (VRTX), Amgen (AMGN), Netflix (NFLX) and Starbucks (SBUX).
Disclaimer: The author has no position in any stocks mentioned. Investors should consider the above information not as a de facto recommendation, but as an idea for further consideration. The report has been carefully prepared, and any exclusions or errors in it are totally unintentional. Details based on company earnings reports and press releases.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Prableen Bajpai
Prableen Bajpai is the founder of FinFix Research and Analytics which is an all women financial research and wealth management firm. She holds a bachelor (honours) and master’s degree in economics with a major in econometrics and macroeconomics. Prableen is a Chartered Financial Analyst (CFA, ICFAI) and a CFP®.
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