“And though Apple still has a ways to go to compete with Microsoft in terms of net income due to Microsoft’s stunning operating margin, many will be surprised to learn that Apple will actually post more revenue than its rival in the 2010 and 2011 fiscal years,” Zaky reports.
“In fact, when Microsoft reports second quarter calendar results after the bell this afternoon, its likely that Apple will have surpassed Microsoft in revenue for the first time in the company’s recent history – and that it will continue to do so in the future,” Zaky reports. “Apple reported $3.25 billion in net income ($3.51) on a whopping $15.7 billion in revenue on Tuesday, smashing analyst expectations, and reporting more or less in line with my forecast.”
“Microsoft, on the other hand, is expected to earn $4.1 billion in net income ($0.46 in EPS) on $15.26 billion in revenue when it releases results after the bell today,” Zaky reports. “That is nearly $500 million less than what Apple reported in revenue this quarter. And while Microsoft also regularly reports upside surprises making it very possible that it could edge out Apple in revenue, the gap between consensus estimates and Microsoft’s actual results is nowhere near as wide as it is with Apple’s results.”
Zaky reports, “Within the next year or so, Apple will soon not only record more revenue than Microsoft, but will earn more in net income, generate a larger amount of cash, and out-pace Microsoft in terms of growth in net income and revenue. Still, Apple does have a ways to go before it will surpass Microsoft in net income. Due to Microsoft’s extraordinarily high operating margin, the only way Apple can beat Microsoft in earnings is by simply outpacing it in sales. Since Microsoft pushes more of its revenue to the bottom line, Apple will have to significantly outpace Microsoft in revenue to win on the net income front – something that Apple will probably do in 2012.”
There’s much more in the full article, including charts, – highly recommended – here.
Microsoft will remain the profit leader until Google gets off it’s ass and gets Chrome OS for PCs out the door and in the hands of PC manufactures at the low, low price of $0.00 dollars.
Then watch Microsoft’s profits take a shit kicking.
I prefer to deal with tangibles, not theory, that way, I gets what I pays for!
There is one thing that everyone keeps forgetting. Microsoft has a strong lead in most average persons mind….. because……….. they are the biggest. And the biggest is always the best… right?
Microsoft lost the marketcap title to Apple and it has held it. If Apple gets the revenue title, Microsoft loses a little more of its facade.
For every person who switches to Apple, its a permenate loss to Microsoft. Not counting 3rd world countries where cheaper and knockoff are the only words to live by, this change from MS to Apple is a one way street. PERIOD.
And as the iPad takes sales from netbooks, each sale is a long term loss to MS. The foundation is weak, the structure is wobbling. Once MS starts to fall, watch out below. It will not close, but falling sales means layoffs, which show weakness, which means falling sales, run round, run round…
Just a thought here.
en
“something that Apple will probably do in 2012” (when the world finishes)
cool =)
Heh, heh, heh >8^)
Maybe Microsoft need to just charge more for their virus infested old school buggy software so they can stay a head of Apple for another 3 or 6 months. That should chase the Microsoft diehards and get another half of them to jump ship. The Microsoft Titanic is taking on water and going down fast.
Is that a dancing monkey steering that ship?
Sales of iMacs with Os X show that people know a good thing when they try one. Thank you for the Apple stores.
Look at how the pc hands on in best buy stores show the pc for what it is-a salesman’ s product.
They STILL don’t trust Apple’s story. How else do you explain a P/E for Apple in the low 20s when earnings are growing at almost 80%?
Yes once the Microsoft snowball starts to tumble it will most likely take on a momentum all of its own picking up all sorts of useless detritus along the way. Talking of which old Thurrott and co had better make sure there’s a back door to their highly exposed wooden shed they occupy below.
I have Apple’s ttm PE at 19. They have made $12.24B in the last 12 months; while current market cap is $235B, which comes out to only 19. Forward PE is much lower. And, if you net out cash, it gets even lower.
Here’s something else people are forgetting: Jobs says that Apple has more fantastic products in the pipeline. All it’ll take is one release similar to that of the iPad and you’ll see Apple overtake Microslop long before 2012.
Yawn. Clearly some insecure MAC cultist is manipulating statistics to make insane proclamations that some little company run by hippies in California would somehow overtake mighty Microsoft and their stable of magnificent, innovative products.
Nonsense, and you know it MAC sheep. Soon Windows Phone 7 featuring the Zune media player will destroy the I-Phone once and for all. The enterprise will flock to these devices and MAC will go back to their room with their tail between their legs to perhaps finally develop a 2-button mouse, but it will be too little, too late.
Your potential. Our passion.™
But… but… Microsoft has those RETAIL STORES now. No way to keep those babies from building their profits exponentially.
The world finished in 1926.
At least that’s what the Jehovahs said the Bible said.
Around 1925 this was.
Not sure how they wriggled out of that prediction.
The world will end when I’m damn good and ready to kick the bucket and not a minute sooner.
Microsoft’s extraordinarily high operating margin =
Develop crap software for cheap and sell said bloated crapware for far more than it’s worth.
Just how much longer are people going to pay the huge cost of Office and it’s upgrades? It’s a word processor with some extended features.
Didn’t happen – MSFT topped 16 billion
Apple is unrivaled.
amazing!!!
push AAPL higher and also make its price less volatile, as index-based funds will be required to own it.
2010. Apple win a lot. And I think iPad( http://www.ifunia.com/ipad-column/index.html) helps a lot in 2010.
And I have seem the specifically analysed “The Race for Market Cap: Apple vs. Wal-Mart and Microsoft ” in http://seekingalpha.com/article/206399-the-race-for-market-cap-apple-vs-wal-mart-and-microsoft ( issue Details form)