Apple Quarterly Revenues Surpass Microsoft

Posted Oct 29th 2010 9:30AM by Michael Fowlkes
Filed under: Earnings Reports, Good news, Products and Services, Consumer Experience, Competitive Strategy, Microsoft (MSFT), Apple Inc (AAPL), Smartphones

Following Thursday's market close, Microsoft (MSFT) reported its fiscal first quarter numbers, and, as Steven Mallas noted, it easily outpaced earnings estimates for the quarter.

Analysts had been expecting to see the company report earnings of 55 cents per share, but actual earnings came in well above at 62 cents per share.

It was a really good quarter for Microsoft, but revenues did not rise enough to stay above Apple's (AAPL) recent quarterly numbers. Microsoft had revenues of $16.2 billion during the quarter, up from $16 billion during its fourth quarter. Apple reported earlier this month it had revenues of $20.34 billion.

This marks the first time in a decade and a half that Apple was able to report higher revenues than its rival.

What separates the two companies the most is that Apple has revenue coming in mostly from consumer hardware products, while Microsoft continues to earn most of its revenues from licensing deals and software sales to consumers.

Apple has been seeing steady growth in products such as the iPhone, iPad and iTouch, as well as growing sales of music and software. Micorsoft's major revenue streams continue to be Office and Windows.

Here is a chart from AppleInsider that illustrates revenue growth for the two companies over the past two years:

Apple's massive growth recently has definitely been impressive. Earlier this year it overtook Microsoft in terms of total market share, and now that it has surpassed the company in terms of revenues, there is just one hurdle left. Profit.

Microsoft is still ahead in the profit category, reporting $5.4 billion in first quarter profit. Apple reported $4.3 billion for the current quarter, so it still has a way to go before it overtakes Microsoft in this area.

Will this holiday season be enough to push Apple ahead? It very well could be. Microsoft will be selling a lot of XBox's, but Apple is going to be selling quite a few iPads, and iTouches this year. Can they sell enough to overtake Microsoft in profit for the quarter? It could be close... what are your predictions?

Tags: apple earnings, featured, inthenews, Microsoft, microsoft earnings, miscrosoft profit, miscrosoft sales, xbox

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Reader Comments (Page 1 of 1)

10-29-2010 @ 10:39AM

Steffen Jobbs said...

Apple is going to have to do a lot more in order to change Wall Street's mindset that Microsoft can never be worth less than Apple. It appears that market cap isn't a good indicator of company value so Microsoft is still being claimed as the larger of the two companies. Wall Street believes that Apple will collapse tomorrow and Microsoft will be powerful indefinitely. I guess it's because Microsoft is so deeply imbedded into the computing industry like the way IBM used to be. Nobody ever figures that the tides can shift unfavorably for the larger company. I'm not sure what Apple needs to do to prove that it's worth every penny and that the present market cap isn't just a fluke. At some point in time Apple needs to prove it is just as important a company as Microsoft is to the world.