When Apple passed Microsoft in market cap this past May, the Microsoft fanboys were out in full force. “This means nothing.” “Microsoft still makes so much more money than Apple.” “Look at the revenues.” Okay, let’s look at the revenues.
Microsoft just posted their earnings for last quarter. The result? $16.2 billion in revenue. A very strong number, easily beating what the Street was projecting. But just 10 days ago, Apple posted their revenues for this past quarter. The result there? $20.34 billion. Yep.
During the last round of earnings results in July, some people had been predicting that Apple would pass Microsoft in revenue (though, for the record, I wasn’t so sure). But sure enough, Microsoft stayed barely ahead of Apple by about $700 million. But as we noted at the time:
It seems quite likely that next quarter Apple will surpass Microsoft in revenue. Assuming that iPhone 4 sales are huge and that the iPad continues to grow, Apple’s momentum in revenue is simply too great for Microsoft to keep up with. Apple may or may not hit $20 billion in revenues next quarter (they’re projecting $18 billion, but they always low-ball that number so they can beat it).
And here we go. Not only did Apple hit that $20 billion revenue quarter, Microsoft’s quarter-to-quarter total only went up slightly (around $200 million). And so Apple zoomed right by them.
Naturally, it’s important to note that Microsoft still has a lead in profit — $5.41 billion to $4.31 billion — but that’s because one is mainly a software maker (huge margins), while the other is mainly a hardware maker (lower margins). If this trend continues, that will change soon shortly as well. Remember, it’s the holiday quarter now.