Microsoft’s revenue expected to fall $4.54 billion short of Apple’s record $20.34 billion

“Later today after the markets close, Microsoft will announce its first-quarter earnings, which a consensus of Wall Street analysts expect to show earnings of 55 cents a share on $15.8 billion in revenue,” Kara Swisher reports for AllThingsD.

MacDailyNews Note: On October 18, 2010, Apple Inc. posted record revenue of $20.34 billion for the company’s fiscal 2010 fourth quarter.

Swisher continues, “Wall Street has been downgrading Microsoft’s stock, mostly due to worries about the surging popularity of the Apple iPad, the introduction of even more upcoming tablets and the trend’s overall impact on PC and, especially, netbook sales that run the company’s software.”

Read more in the full article here.

MacDailyNews Take: Revenue is one thing, net income is another. Apple’s net quarterly income on that $20.34 billion was $4.31 billion. Last quarter, Microsoft reported net income of $4.52 billion on $16.04 billion in revenue and the company will have the first full quarter of sales of the obscenely profitable Office 2010 to report. We’ll find out later today where the two companies stand in relation to each other on quarterly profit.

52 Comments

  1. @MDN Take

    MS primarily sells licenses. Apple primarily sells products that must be manufactured. The fact that Apple’s Net Income is so close to that of MS is actually quite remarkable. Also, as economies of scale kick in with iPad manufacturing costs, Profit Margins will begin to exceed estimates once again.

  2. @MDN Take

    MS primarily sells licenses. Apple primarily sells products that must be manufactured. The fact that Apple’s Net Income is so close to that of MS is actually quite remarkable. Also, as economies of scale kick in with iPad manufacturing costs, Profit Margins will begin to exceed estimates once again.

  3. A major conclusion from this data is that Microsoft has a higher profit margin per dollar of sales than Apple.

    This means Microsoft charges a LOT for their products relative to costs.

    Somehow this has always escaped the attention of the Winbois complaining about Apple’s “high prices”.

  4. A major conclusion from this data is that Microsoft has a higher profit margin per dollar of sales than Apple.

    This means Microsoft charges a LOT for their products relative to costs.

    Somehow this has always escaped the attention of the Winbois complaining about Apple’s “high prices”.

  5. Chuck,

    Microsoft’s primary products do NOT require any manufacturing. Vast majority of their primary product (Windows, Office) does not even require CD printing anymore. They just sell you a number, and a sticker with a holographic image. That’s about the only direct, physical expense they have for their product. Compare that to an iMac, iPad, iPod, iPhone… And yet, even with all that physical hardware that has to be put together, packaged, shipped, warehoused and delivered to the consumer, Apple’s profit margins are almost as high as Microsoft’s. Obviously, Microsoft is wasting colossal amounts of money on something…

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