How long until Apple is bigger than Microsoft?

[LegendKiller]

AAPL market cap...83bn.

MSFT market cap...199bn

APPL total assets...31bn

MSFT total assets...73bn

APPL total current assets...28bn

MSFT total current assets...43bn


MSFT total dividends paid, last quarter (share buyback plus cash)...5bn

APPLE...0

In the last 3 years MSFT bought as many shares and paid as much cash out in divs to buy almost 70% of apple at current valuations.



MSFT ROA: 22.02%
AAPL ROA: 12.08%

MSFT ROE: 52.48%
AAPL ROE: 27.19%


TTM statistics

MSFT profit margin 29%
AAPL profit margin 14.8*%

MSFT total cashflow...21BN
AAPL total cashflow...9.6bn

MSFT levered free cash...17bn
APPL levered free cash...4.36bn


On average, apple stock is over 2x as risky (beta of 2.2+ vs 1.13 msft), it is less well run (ROE and ROA), it has lower profit margins, it generates far less cash, has performed worse over the last year, has no dividends, has far less levered cash.

The idea that you should compare cash vs cash is just stupid, especially considering MSFT gives back, per year, almost as much cash as APPL currently as on hand. It does so because it runs out of projects to invest the cash at a good rate of return, despite earning ROE and ROA far higher than Apple.

That's what you get from a tech website with no finance training though.

Apple will take a very long time, if ever, to get to the size of MSFT.

 

[Tim]

Originally posted by: LtPage1
Never. I'm a die-hard Mac guy, always have been, and I don't ever want it to happen. A huge part of why Apple's entire product line is head and shoulders above everyone else is because we're still more or less a niche segment.

Pfft. Slower overpriced hardware FTL.

 

[Ns1]

Originally posted by: LegendKiller
AAPL market cap...83bn.

MSFT market cap...199bn

APPL total assets...31bn

MSFT total assets...73bn

APPL total current assets...28bn

MSFT total current assets...43bn


MSFT total dividends paid, last quarter (share buyback plus cash)...5bn

APPLE...0

In the last 3 years MSFT bought as many shares and paid as much cash out in divs to buy almost 70% of apple at current valuations.



MSFT ROA: 22.02%
AAPL ROA: 12.08%

MSFT ROE: 52.48%
AAPL ROE: 27.19%


TTM statistics

MSFT profit margin 29%
AAPL profit margin 14.8*%

MSFT total cashflow...21BN
AAPL total cashflow...9.6bn

MSFT levered free cash...17bn
APPL levered free cash...4.36bn


On average, apple stock is over 2x as risky (beta of 2.2+ vs 1.13 msft), it is less well run (ROE and ROA), it has lower profit margins, it generates far less cash, has performed worse over the last year, has no dividends, has far less levered cash.

The idea that you should compare cash vs cash is just stupid, especially considering MSFT gives back, per year, almost as much cash as APPL currently as on hand. It does so because it runs out of projects to invest the cash at a good rate of return, despite earning ROE and ROA far higher than Apple.

That's what you get from a tech website with no finance training though.

winnAr.

 

[aphex]

Just out of sheer curiosity clarkey01, why are you so deeply vested in the Apple vs. PC discussions? Not that there is anything wrong with it at all, but I've just noticed the times you post in the Apple forum or in an apple topic here in OT its always regarding the Apple vs. PC debate.

 

[Cabages]

I would hope never.

But as we saw with the mac mini, they can offer cheaper products.

Either way, I will always have linux to build systems on.

 

[Ns1]

Originally posted by: Cabages
I would hope never.

But as we saw with the mac mini, they can offer cheaper products.

Either way, I will always have linux to build systems on.

you mean the cheapest product that they discontinued? lol

 

[rchiu]

Why even compare Apple to MS? MS is pretty much a pure software company and Apple is mostly in hardware with a few software and apps here and there.

And do you people realize how big MS is outside of their Operating System/Office suite? They got business/ERP software, server stuff, B2B stuff and they are building a whole service/support/consulting team around those business software/solutions. Apple is pretty strong in consumer area, but outside of that, they don't have any presence.

 

[Zenmervolt]

Just looking at that article, MS is doing better.

For ever $1,000,000,000 in revenue, MS makes $284,768,211 in profit.

Apple, in comparison, makes only $205,128,205 in profit.

That's $80 million in MS's favor for every $1 billion in revenue. Granted, Apple's 20% profit ratio is impressive, but MS's 28% is even more impressive. Clearly MS has some efficiencies that Apple does not.

ZV

 

[XxPrOdiGyxX]

never

 

[manly]

Originally posted by: Zenmervolt
Just looking at that article, MS is doing better.

For ever $1,000,000,000 in revenue, MS makes $284,768,211 in profit.

Apple, in comparison, makes only $205,128,205 in profit.

That's $80 million in MS's favor for every $1 billion in revenue. Granted, Apple's 20% profit ratio is impressive, but MS's 28% is even more impressive. Clearly MS has some efficiencies that Apple does not.

ZV

MSFT is not more impressive since they have two dominant monopolies (desktop OS + office suite) and you're comparing margin for primarily a software company vs. a hardware/electronics maker.

I'm not sure what question the OP is trying to ask. Obviously, Mac OS X will never approach 50% market share. But Apple has already proven it can dominate a product segment (DAP) and is going to make a strong run at another (smartphone). Although nobody expects Apple to capture #1 market share; in a total handset market of 1B units annually, Apple doesn't need anywhere near the iPod's 75% share to make a killing. Just look at their most recent quarter where GAAP rules obscured their growth.

 

[ViviTheMage]

Originally posted by: Kaido
As an Apple fanboy, never. Bill Gates won because he embedded his system into the universe. EVERYONE grew up on Windows. EVERYONE knows how to use Windows. Countless businesses rely on Windows-only apps, servers, and desktop systems. It's too ingrained in our tech culture to change. Won't happen, ever.

How wrong you are...I grew up with apple PC's, and I now use MS PC's because Apple PC blows...

 

[foghorn67]

Originally posted by: ViviTheMage

Originally posted by: Kaido
As an Apple fanboy, never. Bill Gates won because he embedded his system into the universe. EVERYONE grew up on Windows. EVERYONE knows how to use Windows. Countless businesses rely on Windows-only apps, servers, and desktop systems. It's too ingrained in our tech culture to change. Won't happen, ever.

How wrong you are...I grew up with apple PC's, and I now use MS PC's because Apple PC blows...

True. When I was a kid, PC's were the price of brand new small cars. Apples were in classrooms. I used Apple growing up.
Now, I don't have a use for anything Apple.

 

[clarkey01]

Originally posted by: aphex
Just out of sheer curiosity clarkey01, why are you so deeply vested in the Apple vs. PC discussions? Not that there is anything wrong with it at all, but I've just noticed the times you post in the Apple forum or in an apple topic here in OT its always regarding the Apple vs. PC debate.

I have never really be too bothered about apple but recently (while at uni) I have had several discussions with people who have gone the mac route.

This wouldn't be a problem but they seem to preaching to me and other class mates, almost having a dig each day because I run Vista & Ubuntu.

I find it fascinating to why (most) apple user's feel this way, I used to have a G5 and I didn't think too much of it, but it wasnt bad...

I have had another experience when I went into an apple store, I was just taking a look at the £699 macbook for fun and an apple sale guy (young, wore sandles and had a beard) came over to me and asked me if I was thinking of "switching" I told him I was a power user and I liked my gaming and dual booting. He then tried to get me on his side by coming out with comments like "Piff windows vista, you MUST have alot of grief" to witch I replied

" I haven't got time for over priced hardware, restrictions on software and the lack of ability to choose my OS"

He then tried to back track, he noticed I was a little aggressive so he tried talking to me about bootcamp, I then politely told him I wasnt interested, he kind of went red faced and I left.

 

[jagec]

One button mouse. 'Nuff said.

Sure, Apple does a good job of making intuitive software which still allows you to change (most) of what you need to, but I guess being able to use my index AND my middle finger separately makes me different from your average mac user. I haven't used an Apple mouse yet that I didn't HATE. The hockey puck mouse is just the worst of the bunch.

...OK, technically there IS a "two-button mouse" available for mac. But I use it a lot at work (unfortunately we have a software package that only runs on OS X), and it's insufferable, constantly detecting false right-clicks and seems especially designed to be difficult to reposition if you reach the end of your mousepad while dragging. Contrast this to PC mice, which NEVER have problems separating right-clicks from left, and which are almost always easy to pick up while holding down a button and move to the opposite corner of your mouse pad.

 

[DayLaPaul]

The 2 finger scrolling is pretty sweet on their laptops.

 

[dmcowen674]

Originally posted by: LegendKiller

The idea that you should compare cash vs cash is just stupid, especially considering MSFT gives back, per year, almost as much cash as APPL currently as on hand. It does so because it runs out of projects to invest the cash at a good rate of return, despite earning ROE and ROA far higher than Apple.

That's what you get from a tech website with no finance training though.

Apple will take a very long time, if ever, to get to the size of MSFT.

Say what you want but MSFT has really shot themselves in the foot with Vista.

 

[Anubis]

Originally posted by: dmcowen674

Originally posted by: LegendKiller

The idea that you should compare cash vs cash is just stupid, especially considering MSFT gives back, per year, almost as much cash as APPL currently as on hand. It does so because it runs out of projects to invest the cash at a good rate of return, despite earning ROE and ROA far higher than Apple.

That's what you get from a tech website with no finance training though.

Apple will take a very long time, if ever, to get to the size of MSFT.

Say what you want but MSFT has really shot themselves in the foot with Vista.

its not MS's fault people like you are total idiots and cant use their OS. PEBKAC is the #1 cause of issues with vista

 

[DisgruntledVirus]

Originally posted by: Kaido
Although, I would have to say Apple has a fair chance of getting a lot of NEW users with a price drop. They did it with the iPhone - they introduced it at $600, got the market talking, and a year later chopped the price to $199 and made it more awesome. Suddenly it's affordable and attractive to everyone - 3D, GPS, flush headphone jack, etc. Right now their hardware prices are ridiculous - $1300 for a 13" laptop, $2000 for a 15" laptop? One of these days they may come out and drop the prices and snag the market, just like the iPhone - get the market talking, then BOOM gobble it up. If they sold Mac Minis for $299 and Macbook Airs for $799, I think pretty much everyone buyng a new computer (consumer-wise) would own a Mac. Those two machines fill most consumer needs, i.e. Word, Internet, E-Mail.

Now Apple just needs to buy VMware Fusion or Parallels and integrate it with OS X - they already offer free data transfer when you buy a new Mac, so why not directly into a VM so you can keep all your files intact? Throw in a free copy of Office for Mac and slash the prices and everyone is happy

More attractive sure, but where is: MMS, copy/paste, Java, and many other features that are standard on smartphones?

Apple advanced the interface and the market with a great new phone, but took 2 steps back in the features department.

 

[DisgruntledVirus]

Originally posted by: irishScott
Linux and OSS will always be free, and linux is getting bigger and bigger in terms of desktop usage. May take a decade or two, but I see it gaining a considerable position.

And the RIAA can go fuck itself. If I can see it or hear it I can copy it. Period.

Don't care about IP eh?

So on your basis what reason do I have to produce ANY form of art (be it music, movies, code, or any other form of creative expression)? Contrary to your belief they have rights, and deserve to get paid for their work.

How about we don't pay you for your experience and skills, and instead pay you the same as an entry level guy? You have the same job title, same job description, and work for the same company so you should get paid the same as him.

 

[Genx87]

Originally posted by: irishScott
Linux and OSS will always be free, and linux is getting bigger and bigger in terms of desktop usage. May take a decade or two, but I see it gaining a considerable position.

And the RIAA can go fuck itself. If I can see it or hear it I can copy it. Period.

The last retail marketshare numbers I saw on the desktop in the summer had Linux at a whole .56% of the market. OSX was at 8%.

 

[Zenmervolt]

Originally posted by: manly

Originally posted by: Zenmervolt
Just looking at that article, MS is doing better.

For ever $1,000,000,000 in revenue, MS makes $284,768,211 in profit.

Apple, in comparison, makes only $205,128,205 in profit.

That's $80 million in MS's favor for every $1 billion in revenue. Granted, Apple's 20% profit ratio is impressive, but MS's 28% is even more impressive. Clearly MS has some efficiencies that Apple does not.

ZV

MSFT is not more impressive since they have two dominant monopolies (desktop OS + office suite) and you're comparing margin for primarily a software company vs. a hardware/electronics maker.

MS's two "monopolies" are heavily regulated by the government and the costs associated with testing their software on the near-infinite number of hardware combinations available are not at all insignificant. Other software companies like Symantec or Electronic Arts have profit margins between 5% and 9%. MS has a profit margin that is some 20% higher than most other software firms.

Other hardware/electronics companies like Sony and Motorola have profit margins between, you guessed it, 5% and 9%. Apple's advantage over similar companies in terms of profit margin is "only" about 12%.

MS is still doing better.

ZV

 

[finite automaton]

Originally posted by: Capt Caveman

Originally posted by: loki8481
I shudder at the idea of mac servers overrunning my data center.

You mean linux based servers.

MacOS is not Linux, it's a mauled version of BSD.

 

[Special K]

Originally posted by: LegendKiller
The idea that you should compare cash vs cash is just stupid, especially considering MSFT gives back, per year, almost as much cash as APPL currently as on hand. It does so because it runs out of projects to invest the cash at a good rate of return, despite earning ROE and ROA far higher than Apple.

Of what benefit is it to MSFT (or any company really) to pay back its profits to shareholders in the form of dividends? I understand how a company could not have any projects to invest the cash in that would give a good rate of return, but why do they not just save the money? What benefit is there to paying it out as dividends? Also, why wouldn't they invest that money in their Zune project, considering it doesn't seem to be doing particularly well?

It's a serious question - I'm just curious how this works.

 

[manly]

Originally posted by: Zenmervolt

Originally posted by: manly

Originally posted by: Zenmervolt
Just looking at that article, MS is doing better.

For ever $1,000,000,000 in revenue, MS makes $284,768,211 in profit.

Apple, in comparison, makes only $205,128,205 in profit.

That's $80 million in MS's favor for every $1 billion in revenue. Granted, Apple's 20% profit ratio is impressive, but MS's 28% is even more impressive. Clearly MS has some efficiencies that Apple does not.

ZV

MSFT is not more impressive since they have two dominant monopolies (desktop OS + office suite) and you're comparing margin for primarily a software company vs. a hardware/electronics maker.

MS's two "monopolies" are heavily regulated by the government and the costs associated with testing their software on the near-infinite number of hardware combinations available are not at all insignificant. Other software companies like Symantec or Electronic Arts have profit margins between 5% and 9%. MS has a profit margin that is some 20% higher than most other software firms.

Other hardware/electronics companies like Sony and Motorola have profit margins between, you guessed it, 5% and 9%. Apple's advantage over similar companies in terms of profit margin is "only" about 12%.

MS is still doing better.

ZV

I like how you quote monopolies as if it wasn't true.

I also like that you consider MS Windows & Office "heavily regulated" by the feds. About the only time Microsoft ever was punished for illegally abusing its monopoly power was when the EU fined them.

I still disagree with your conclusion because you're comparing profit margin between a company that has two dominant and large software monopolies vs. a hardware/electronics maker that at best has one dominant product (iPod). Software costs virtually nothing to publish once the R&D (+QA/marketing) investment has been made.

As far as the sector comparisons you made, Symantec competes against numerous (if smaller) global players in their most known product line: security software. EA is more of an entertainment company. A more apt comparison for Microsoft would Oracle, for example.

 

[LS8]

Originally posted by: clarkey01
How long until Apple is bigger than Microsoft?

Never. Windows based PC and notebook shipments aren't in any way shape or form threatended by being overtaken by Apple. The average person buys their computer from some jerk at BestBuy and the average company buys over the phone from Dell or HP.

If you look at big companies that are ordering 50,000+ PCs a year, every year, over and over, it isn't hard to see that Microsoft isn't going anywhere.