Apple Tops Microsoft Revenue in Third Quarter

Apple Tops Microsoft Revenue in Third Quarter

Credit: aresauburn/flickr

First Apple surpassed rival Microsoft in market capitalization, now the Cupertino, Calif. company has beaten the business that Bill built in terms of flat-out revenue. The iPad maker recorded a record $20.34 billion this quarter, compared to Microsoft’s $16.20 billion.

Apple didn’t just beat the Redmond-based software giant, but stomped Microsoft’s best ever three-month period: $19 billion in revenue. The one area Microsoft still leads is profit margin. The company reported $5.41 billion compared to Apple’s $4.31 billion. Apple’s profit margin was below expectation this quarter as it dealt with keeping costs low for the iPad and the extra expense of a free bumper program in response to problems with the iPhone 4.

Microsoft’s biggest portion of profits reported were from sales of Office, which garnered $5.13 billion. (The company recently released Office 2011 for the Mac to mixed reviews.) Microsoft’s Windows division, usually an anchor, brought in $4.79 billion. Microsoft has yet to find the right product to challenge Apple’s iPod or iPhone, a possible reason for its Entertainment Devices Division reporting just $1.8 billion.

By contrast, Apple recently reported $8.8 billion in iPhone sales, $2.8 billion from the iPad, and $1.4 billion from the iPod. The Cupertino, Calif. company also raked in $1.2 billion from iTunes music products, $4.9 billion from Macs and $1 billion from software, peripherals and services.

Despite the long-running rivalry, the two companies have recently become partners to shape the computer industry. Apple’s iPad along with Microsoft’s push for higher priced PCs has put a dent in netbook demand, while Microsoft has expanded into providing software for the Mac, including Office for OS X and software syncing Windows Phones with iPhoto and iTunes.

[AppleInsider, Mac Rumors]

About the author

Ed SutherlandEd Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.

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