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Thu, Dec 31, 2009 - 11:07 PM EST  —  AAPL: 210.732 (-0.908, -0.43%)  |  NASDAQ: 2269.15 (-22.13, -0.97%)

Can Apple surpass Microsoft as the world’s most valuable tech company?
Tuesday, November 10, 2009 - 11:45 AM EST

Apple Online Store"Apple Inc's phoenix-like rise from the ashes has propelled its market value to $180 billion, raising the possibility that it could challenge Microsoft Corp for the technology crown," Gabriel Madway reports for Reuters.

"Microsoft is now the world's most valuable tech company with a commanding market capitalization of $250 billion. Its Windows software is in nine out of 10 personal computers," Madway reports. "It would take impressive execution for any company to unseat Microsoft at the top of the technology heap."

MacDailyNews Take: Impressive execution, you say?
• Apple mows down Street, backs up, runs over it again: $9.87B rev., $1.67B profit; sells 3.05M Macs - October 19, 2009
• Apple beats Street with best non-holiday quarter revenue and earnings in Apple history - July 21, 2009
Apple smashes Street; reports best non-holiday quarter revenue and earnings in company history - April 22, 2009
Apple demolishes Street with best quarterly revenue and earnings in company history in fiscal Q109 - January 21, 2009
Apple bulldozes Street: $1.26 EPS; Mac sales reach all-time high of 2.5m, 6.9m iPhones, 11m iPods - October 21, 2008
Apple smashes Street; reports record third quarter results, all-time high Mac sales - July 21, 2008
Apple smashes Street, reports record second quarter results - April 23, 2008
Apple beats Street; reports best quarterly revenue and earnings in company history - January 22, 2008

Versus:
Microsoft axes another 800 employees on top of the 5,000 already terminated - November 04, 2009
Apple’s Mac share grew after Microsoft’s Windows 7ista debut - November 02, 2009
Microsoft revenue down 14%, profit plummets 18% - October 23, 2009
• Microsoft CEO Ballmer gets $25,000 raise as company profit plummets 17% - September 19, 2009
• Microsoft shares plunge after quarterly profit disappoints; net income drops 29% - July 23, 2009
Microsoft axes 5,000 jobs in first-ever companywide firings as revenue, profits miss expectations - January 22, 2009

Madway continues, "But Apple, flush with cash and fat margins, has catalysts in the iPhone, the Mac PC and a highly anticipated but unconfirmed tablet device expected to launch next year, analysts and investors say."

"Apple's revenue is still far smaller than that of its arch nemesis, but it is growing at a more rapid rate. Apple's annual revenue has more than doubled since 2005 to $36.5 billion, with earnings per share up more than four-fold to $6.29," Madway reports. "Over the same period, Microsoft's revenue has risen 47 percent to $58.4 billion, with EPS up 45 percent to $1.62."

Madway reports, "Apple's shareholders have been handsomely rewarded over the past decade, with its stock up close to 900 percent. Over the same period, Microsoft's shares have fallen around 35 percent."

Read more in the full article here.

MacDailyNews Note: Apple's (AAPL) current market value stands at $181.44 billion. Microsoft's (MiSFiT) is $258.38 billion.

[Thanks to MacDailyNews Reader "Joe Architect" for the heads up.]

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Nov 10, 09 - 11:51 am Comment from: jarrettdailynews

There are a bunch of morons over at gizmodo who seem to think it's not possible for this to happen. I know a few former CEO's of Motorola and Palm who thought along those same lines. Stupid people generally remain stupid.

Nov 10, 09 - 11:53 am Comment from: BluefinPro

I still think it would be a really impressive execution if anyone can unseat IBM of the 1970's from their place. I mean, they sell desktops, laptops, software, servers and service. What could possibly go wrong?

It'll never happen!

Nov 10, 09 - 11:53 am Comment from: jarrettdailynews

Oh yeah, was anyone elses 10.6.2 update only 157+MB? I swore I read that it was over 400MB. Did I only receive a partial because I have a 13 MacBook Pro?

and Oh Oh yeah, first, even a snappy first bitches!!!!!

Nov 10, 09 - 12:00 pm Comment from: Snow Leopard

@jarrettdailynews

It was ~157MB on my CoreDuo iMac running 10.6.1
It was ~500MB on my Core Duo MacBook running 10.6

I thought that was strange too.

Nov 10, 09 - 12:06 pm Comment from: TheConfuzed1

@ jarrettdailynews & Snow Leopard--

It's possible that the combo updater also upgrades other software bundles along with it, such as Quicktime, iLife, etc...

Perhaps it's a different size with different systems, because it depends on the software currently installed on the device.

Nov 10, 09 - 12:10 pm Comment from: my update

My early 2007 Core 2 Macbook was only 146 MB to update.

my Slightly older Core 2 20" imac (late 2006 early 2007 wants 500MB!! WTF?

Both were/are running 10.6.1 with much of the same software...

Nov 10, 09 - 12:11 pm Comment from: Jim - TIV

157mg on the iMac, 500+ on the two macbooks...

Nov 10, 09 - 12:15 pm Comment from: NHL

Note in the mirrors of all Microsoft vehicles:
"Apple-Shapped Objects Are Closer Than They Appear"

Nov 10, 09 - 12:18 pm Comment from: El Guapo

Apple has always been worth more than Microsoft. Worth is measured by many more qualities than money.

Nov 10, 09 - 12:24 pm Comment from: Big Als MBP

@ El Guapo,

"Worth is measured by many more qualities than money."

How about, 'Worth is measured by many more qualities than market capitalization'.

Nov 10, 09 - 12:28 pm Comment from: G4Dualie

The question is not, can, but when.

Also, another metric to consider is Microsoft's rate of decent in relation to Apple's ascent.

The snowball (tipping point) metric will be devastating for Microsoft.

Nov 10, 09 - 12:33 pm Comment from: Macaday

Absolutely. Apple is already worth way more than Microsoft.

It just isn't apparent yet from the numbers.

Original MBP from week 13 - 157mb.

Nov 10, 09 - 12:34 pm Comment from: G4Dualie

@jarrett daily news

why are you hijaking this thread?

Not only are you childishly giddy about being first, but now you attempting to change the subject? WTF?

There is a perfectly good thread on these boards to weigh in on the size of your download.

Nov 10, 09 - 12:38 pm Comment from: Think

@G4Dualie

Yes, when that happens, I'll be going to a bar to drink and get a front row seat to watch.

Nov 10, 09 - 12:50 pm Comment from: G4Dualie

Some would argue tech stock issues in the NASDAQ don't belong on the DOW, but I say, at some point Apple will displace Microsoft on the DOW as the better tech investment.

It will happen, because of Apple's industrial diversity: retail, pro software, computers, telephony, content delivery, and last but not least, whole industries are making billions off Apple's presence in the marketplace.

A couple of other items of note. Software developers are thriving and pushing the envelope and Apple is unleashing myriad technologies that is being embraced by a diverse cross-section of the tech sector, as well as the medical community, law enforcement, and academics, who are using Apple's products to advance their own agendas and fields of science.

This is an exciting time to be one of the Apple faithful.

Go AAPL!

Nov 10, 09 - 12:50 pm Comment from: @ El Guapo

...a pleathora of qualities, perhaps?

Nov 10, 09 - 12:55 pm Comment from: thethirdshoe

I always download the combo and install that.

Nov 10, 09 - 12:57 pm Comment from: jtc

its not if Apple can surpass Microsoft.. its when will it surpass

Nov 10, 09 - 12:58 pm Comment from: Buster

Can Apple overtake MS?
Two words....damn right.

Don't know how much my Quad core tower took because I set it going and went for a big Mac for lunch.....burp.

Nov 10, 09 - 01:00 pm Comment from: joetak

The difference is what happens when you innovate instead of copy. It is all about the product not the sales guy. The iphone continues to be unique, a true palm sized computer with a growing family of apps. the ipod was the first mp3 player with enough storage to hold a personal cd library and a user interface that allowed quick access of that library. The Macs are the best engineered and most widely available unix computers. The tablet when it arrives, will liberate users from keyboards and free their web browsers and programs. Smart people buy what they need,. smart people buy apple products.

If only enterprise users would wise up about Mac OS X server...

Nov 10, 09 - 01:07 pm Comment from: G4Dualie

@Think

Can you say, Pirates of Silicon Valley — Part Deux?

You can rent the movie from the iTunes Store and mix up some margaritas to go along with your nachos, all from the comfort of your cocoon.

tongue wink

Nov 10, 09 - 01:22 pm Comment from: iSteve

When Apple does pass MS in market cap will 1) Steve Ballmer still be CEO and 2) will he claim it is just a rounding error? I wish Ballmer good health because I want him to have that job for many years.

Nov 10, 09 - 01:24 pm Comment from: G4Dualie

@joetak

The difference is what happens when you innovate instead of copy.

If you're referring to the manner in which Microsoft and Apple have copied each other all these years and how these two companies are suddenly meeting in the middle because one is going down and the other up, you hit the nail on the head.

Apple is operating from a long historical context of modest success, overshadowed by millions of failures. It's the failures that have allowed Apple to establish an incredibly robust foundation on which to build its empire.

Microsoft on the other hand, being the original copier, took only those parts of the puzzle they could understand and abandoned too much of what the couldn't comprehend and ended with a GUI that was bolted on to DOS.

Apple (thanks in large part to Jeff) wrote the book on the user interface and failed 999 times. It was that thousandth try that yielded what was to become, relatively speaking, the same Finder we're using thirty years later.

This difference has been in their approach.

Apple embraced their failures, Microsoft has refused to acknowledge them, (Apple's or their own).

Nov 10, 09 - 01:28 pm Comment from: wannabe

Of course they can, as long as Steve Ballmer remains CEO of Microsoft. The biggest risk to Apple right now is that Ballmer will eat one too many sausages.

Nov 10, 09 - 01:36 pm Comment from: 84 Mac Guy

@wannabe

A bigger risk to Apple is that shatter-proof windows are installed at Microsoft's headquarters and one of the chairs Ballmer throws bounces off the window and kills him.

Nov 10, 09 - 01:39 pm Comment from: G4Dualie

and ended with a GUI that was bolted on to DOS.

And if I could further expand on that point; Microsoft eventually abandoned DOS and was left with just a bastardized GUI. Having removed the very foundation of the operating system, and was now attempting to rebuild a foundation on which to park their GUI, Microsoft engineers have struggled since trying to support two dispart, and dysfunctional products.

Perhaps each of these products by themselves is perfectly functional, however when you put the two together they're a fail.

There is no symbiotic relationship, there is no synergy between the two, there is just containment of the problems created by the relationship.

That's what keeps "doctor" Phil in business.

To bad he isn't familiar with stacks. I know a massive group of people who have an intimate understanding of the chaos and confusion resulting from Microsoft's dysfunctional products, but Microsoft doesn't listen to them.

Instead Microsoft is spending billions on campaigns that would have you believe Windows 7ista, was their consumers' idea!

It's pathetic, really.

Nov 10, 09 - 01:59 pm Comment from: MacSmiley

At current values, in the event MSFT stays at its current plateau, Apple's stock price will have to shoot up to $285 per share in order to exceed MSFT's current market cap.

It could happen.

Nov 10, 09 - 02:15 pm Comment from: Mike

I predict that Apple's market cap will surpass the value of MSFT in 2011 or 2012.

By that time, MSFT will have pissed off many more frustrated Windows Service Pack users, the Mac Tablet will be a reality rather than a wet dream, one or more major mobile operators will add support for the iPhone, and movie studios will realize that distribution Apple might actually improve their revenues, given that many people have not embraced the ongoing HDMI fiasco that is dragging down Blu-Ray as a desireable movie distribution method.

The only possible thing that would foil this is if Ballmer has a quadruple bypass, sidelining him for an extended time, if not permanently, which would send MSFT stocks dramatically higher

Nov 10, 09 - 02:21 pm Comment from: G4Dualie

In other news, Berkshire Hathaway stock fell today by more than six-hundred dollars a share. It's now trading at a measly 101,961 dollars per share! (yes, you read that right) That's a change of 62 percent in a few hours of trading.

I'll wager, only a handful of you have even heard of BH, but they are the highest traded stock on the market.

They are a huge conglomerate that recently bought up GEICO and are heavily vested in insurance, utilities, and so much more. They are owned by one of the biggest corporate communists in America.

An item of note is, their stock has never split and they've never paid a dividend!!

Go AAPL!

Nov 10, 09 - 03:04 pm Comment from: the other Mark

"In other news, Berkshire Hathaway stock fell today by more than six-hundred dollars a share. It's now trading at a measly 101,961 dollars per share! (yes, you read that right) That's a change of 62 percent in a few hours of trading."
- - - - - - - - - - - - - - - - - -
Well, it's now down $700. for whopping decline of 0.68%
(redo your math. wink )

Nov 10, 09 - 03:07 pm Comment from: G4Dualie

Man! Why is that?

What could have induced its shareholders to dump the stock?

I'll bet insurance is at the bottom of it. wink

Nov 10, 09 - 03:13 pm Comment from: John C. Randolph

I predict that Apple's market cap will surpass the value of MSFT in 2011 or 2012.

I concur. What I wonder though, is how much of that will be AAPL's increase in market cap versus MSFT's decline.

-jcr

Nov 10, 09 - 03:54 pm Comment from: Mac-nugget

What the tech industry has not realized is that Apple shifted it's foundation with the realise of 10.6. Windows 7 is still the same old code. It still has a registry it is antiquated and insecure. We don't hear about how great Snow Leopard is because we have not seen any major applications taking full advantage of the new developments. In 6 months or so, we will see the benefit of all the hard work Apple has done this past year. Windows 64 is not the same as OSX 64.

Nov 10, 09 - 04:01 pm Comment from: tt

Macs account for the majority of Apple's profit, if they opened OSX I believe they would squash M$

Nov 10, 09 - 05:26 pm Comment from: mike

"I concur. What I wonder though, is how much of that will be AAPL's increase in market cap versus MSFT's decline."

Hmm.. what decline? I'm all for it, but it looks like MS has been on a roll lately. Even a few weeks ago when they announced what looked like ugly numbers, people cheered. They deferred billions of revenue to the next quarter, to coincide with the WIn7 launch so the next Earnings Report for MSFT will be pretty damn good too.

Just... Apple is incredibly strong. This is almost all based on the power of Apple's march, and nothing to do with any 'plummet' in MS's stock.

Like alot of tech companies, MSFT has DOUBLED since the March bottom.
They have a Monopoly in operating systems and that seems to be enough. Even if the rest of their lineup is weak sauce.

Nov 10, 09 - 06:39 pm Comment from: G4Dualie

@tt

Macs account for the majority of Apple's profit, if they opened OSX I believe they would squash M$

How do we know it's not because Macs are well made? It's been my experience, that most people who switch to Macintosh struggle for weeks with OS X, sometimes even months, to get used to doing every thing one-eighty out compared to Windows.

People exposed to OS X for the first time are left with an eerie feeling that they are moving through uncharted territory, which has to be unnerving. Couple that with the fact that people are making an informed decision to buy a Mac knowing that once you go down that road, you have to make it work, lest you regret your decision.

Having said all that though, I have no doubt OS X licensed to Dell, HP, and Lenovo, even Alien Ware, would be a bitterly, monumental challenge for Microsoft to overcome. I don't think Microsoft could recover because once the PC manufacturers begin to offer OS X, Enterprise would follow suit.

I don't want Microsoft to die off to quickly.

As was stated in another thread regarding the confusion between schadenfreude and hate, I would rather see Microsoft burn in flames, rather than shot, to put them out of their misery. You know, like in the movie Saving Private Ryan, when American soldiers called out to their brethren not to shoot the Germans who were on fire but to let 'em suffer a little longer. But that's just the vet in me talking...

iPhone OS licensed to phone manufacturer's though? Oh hell yeah.

Nov 10, 09 - 07:32 pm Comment from: Jarrettdailynews

@G4 foolie

You maroon, it was a drop of about 0.70%. And if you ever call me out like that again I will punch you so hard in the heart you will wish a chair was thrown at you.

Nov 10, 09 - 08:36 pm Comment from: Cubert

"There's no chance that the iPhone is going to get any significant market share. No chance. It's a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I'd prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get."

- Microsoft CEO Steve Ballmer, April 30, 2007

Nov 10, 09 - 08:45 pm Comment from: Cubert

I still remember when Apple sold more than a million Macs in a quarter for the first time.

Last quarter? Just over 3 million.

Impressive, young Jedi. Impressive.

Nov 10, 09 - 08:52 pm Comment from: Cubert

@G4 Dualie,

"It's been my experience, that most people who switch to Macintosh struggle for weeks with OS X, sometimes even months, to get used to doing every thing one-eighty out compared to Windows."

So true. It's been my experience that installing apps via a disc mount image with drag and drop has been the hardest thing for newbies to understand. However, once you show them, the simplicity blows them away.

Nov 10, 09 - 09:16 pm Comment from: G4Dualie

@Jen

let me know when you've throw that punch, okay?

See you around campus, daily snooze.

Nov 11, 09 - 01:44 am Comment from: The Other Steve

If a company buys a bunch of computers for its employees and tells them what to use,

is it really a personal computer?

Nov 11, 09 - 04:03 am Comment from: me

"There's no chance that the iPhone is going to get any significant market share. No chance. It's a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I'd prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get."

Well iPhone is at 2.5% so it seems he was right.

Nov 11, 09 - 07:16 am Comment from: flappo

market share means sod all

it's profit and mid share that matters

apple have won already

Nov 11, 09 - 12:57 pm Comment from: Mike (with a capital M)

@flappo - sorry, but you have no head for business if you don't think market share is important. The long-term goal of any business is to have a cash cow with huge market share so that it can fund new development programs. One program matures with significant market share, funding the next big thing. Apple has it now with the iPod/iPhone, and that's goodness.

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