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Talk about a sign of the times.
Apple is now more profitable than Microsoft.
The Borg earned $5.23 billion in the last three months, nearly $800 million less than Apple's quarterly haul of $6 billion, the Redmond, Washington software giant announced Thursday.
Microsoft reported a solid quarter, with a 31 percent increase in profit. But in an over-bought market, investors pushed the stock down nearly two percent in after-hours trading.
This event is symbolic, because it points to the diverging fortunes of two of the most famous tech companies in the world.
Apple, quite simply, is the hottest company on the planet, with break-through mobile products like the iPhone and iPad, as well as its revered line of Mac desktop computers and laptops. Microsoft, by contrast, is seen as a plodding, hide-bound behemoth, struggling to keep pace as the locus of computing moves off the desktop and into the mobile space and "the cloud."
In particular, Microsoft has been unable to craft a mobile strategy to compete with the likes of Apple, Google's Android operating system, and Research in Motion's line of Blackberry devices. But Microsoft has had some recent successes, including the hugely popular Kinect motion sensing game system, a solid revamp of Windows via Windows 7, a much improved IE browser and its Office productivity software that remains a cash cow, even as the company has been forced to compete with cheap cloud-based competitors.
Despite those bright spots for Microsoft, however, last year, Apple finally surpassed its arch-rival by market capitalization.
From Wall Street's perspective, Apple continues to be a "growth" stock, while Microsoft is generally considered to be a "value" stock. Both companies are attractive to investors, but for different reasons, as a function of any given investor or institution's appetite for risk.
In other words, Apple shares are more likely to increase in value over the next 12 months. Microsoft shares will be more stable, but still a smart investment, though with a lower risk-factor.
It's quite a role reversal. In 1997, the Bill Gates-run Microsoft saved Steve Jobs's Apple with a $150 million investment. And despite the animosity many Apple fans had for Microsoft, Apple lived in its shadow for decades. Not any more.
See Also:- Apple Passes Microsoft as World’s Largest Tech Company
