Apple has become the world's largest technology company as measured by the total value of its shares, passing a major milestone as it overtakes software giant Microsoft.

At the close of trading on the Nasdaq exchange yesterday, Apple's market capitalisation stood at more than $222 billion, while Microsoft's was $219.3 billion.

It was the first time that Apple's total share worth climbed above its rival's.

"Apple's market cap just exceeded Microsoft's for the first time ever, making it the world's largest tech company in terms of market cap," said Brian Marshall, an analyst with BroadPoint AmTech. "It's interesting that just seven years ago, the company traded at less than cash."

A company's market cap is equal to its share price times the number of shares outstanding. A year ago, Apple's shares closed at $130.78; yesterday, the company's shares fell in late afternoon trading to $244.13, a one-year increase of 86.7%.

Microsoft's shares, meanwhile, dropped to $24.99 in late trading, off more than a dollar for the day.

Google, a competitor to both Apple and Microsoft, closed the day with a market cap of $152 billion.

According to BroadPoint's Marshall, both Apple and Microsoft will generate in the region of $65 billion in revenues during the 2010 calendar year.