Both Apple and Microsoft are highly profitable mega-cap franchises, but they differ meaningfully in margin structure and growth trajectory. Apple generated FY2025 revenue of $416.2B [AAPL:Q3] and net income of $112.0B [AAPL:Q7], implying a net margin of roughly 26.9%, while Microsoft posted FY2025 revenue of $281.7B [MSFT:Q3] and net income of $101.8B [MSFT:Q7], implying a net margin of approximately 36.1%—meaningfully higher than Apple's despite a smaller revenue base. On gross profit, Apple reached $195.2B [AAPL:Q15] versus Microsoft's $193.9B [MSFT:Q15], nearly identical in absolute dollars, yet the underlying gross margins diverge sharply: Apple's ~47% reflects its hardware-heavy mix, while Microsoft's ~69% reflects its software and cloud composition. Operating income tells a similar story—Apple's $133.1B [AAPL:Q11] versus Microsoft's $128.5B [MSFT:Q11] are close in absolute terms, but Microsoft's operating margin of ~45.6% far exceeds Apple's ~32.0%.
On growth, Microsoft expanded revenue from $198.3B in FY2022 [MSFT:Q0] to $281.7B in FY2025 [MSFT:Q3], a ~42% increase driven by cloud and AI tailwinds, while Apple's revenue grew more modestly from $394.3B [AAPL:Q0] to $416.2B [AAPL:Q3], roughly 5.5% over the same span. Regarding net income trajectories, both companies experienced a weak intermediate period before accelerating into FY2025: Apple's net income declined across three consecutive years from FY2022 through FY2024 (from $99.8B down to $93.7B [AAPL:Q6]) before recovering sharply to $112.0B [AAPL:Q7], while Microsoft's net income was essentially flat from FY2022 to FY2023 ($72.7B [MSFT:Q4] to approximately $72.4B) before jumping materially in FY2024 and FY2025 to reach $101.8B [MSFT:Q7]. Neither path was a smooth compound; both reflect a period of stagnation followed by acceleration, with Microsoft's FY2025 endpoint implying a stronger margin profile. Overall, Microsoft leads on margin quality and revenue growth rate, while Apple leads on absolute revenue scale.
AAPL: Apple is an exceptionally profitable business at scale, with FY2025 revenue of $416.2B [AAPL:Q3] and net income of $112.0B [AAPL:Q7]. That net income recovery is notable but follows a multi-year decline from a prior peak of roughly $99.8B in FY2022 through a trough of $93.7B in FY2024 [AAPL:Q6], so the rebound reflects a return to and extension of prior levels rather than a sudden breakout. Its gross margin of ~47% (gross profit $195.2B [AAPL:Q15]) and operating margin of ~32% are structurally constrained by hardware mix relative to pure-software peers, and top-line growth has been modest over the past three fiscal years.
MSFT: Microsoft demonstrates superior margin quality and faster top-line growth, with FY2025 revenue of $281.7B [MSFT:Q3] and net income of $101.8B [MSFT:Q7], implying a net margin of ~36%. Its gross profit of $193.9B [MSFT:Q15] on that revenue base reflects a gross margin of approximately 69%, and operating income of $128.5B [MSFT:Q11] yields an operating margin near 45.6%—both well above Apple's comparable figures. Net income growth was uneven in the middle years before accelerating sharply in FY2024–FY2025, mirroring a broader pattern of cloud and AI monetization gaining traction.