Alphabet is mentioned as one of the companies with whom Apple has signed licensing deals related to AI.
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Should Investors Buy Microsoft Stock Instead of Apple Stock? | MSFT Stock vs. AAPL Stock
Sep 4, 2026
This video compares Apple (AAPL) and Microsoft (MSFT) by examining their approaches to the AI boom, revenue growth, profitability, and returns on invested capital. Microsoft has heavily invested in AI infrastructure and OpenAI, while Apple has focused on licensing deals. Both companies have seen revenue increases, but Microsoft's cloud services are a primary driver, whereas Apple's iPhone remains crucial. Profitability margins favor Microsoft, but Apple excels in returns on invested capital. Supply chain issues are impacting Apple's hardware margins, while Microsoft's large capital investments affect its ROIC.
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Apple's revenue has grown significantly, and a potential foldable smartphone announcement could be a catalyst, but supply chain issues are impacting hardware margins.
Microsoft's operating profit margin has nearly doubled since 2017, reaching 46.8%, and its cloud services backlog exceeds $500 billion, though investor concerns exist regarding concentration in OpenAI.
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