Microsoft Edges Apple as Best Tech Stock to Own in 2027
Apple and Microsoft are two of the most prominent tech giants in the industry, and investors have been debating which stock is the smarter buy now. Both companies recently reported impressive earnings, with Apple's iPhone 17 supercycle contributing to a record-breaking June quarter and Microsoft's Azure business crossing $100 billion in annual revenue for the first time.
Apple's fiscal third-quarter revenue reached $109.4 billion, up 16.4% year over year, with iPhone sales increasing by 22%. Mac revenue also climbed 29%, and Services hit a new record. However, outgoing CEO Tim Cook acknowledged that supply constraints and foreign exchange headwinds contributed to the growth.
Microsoft's fiscal fourth-quarter revenue reached $90 billion, up 18%, with Azure growing 43% and crossing $100 billion in annual revenue for the first time. Commercial bookings surged 84% to $678 billion, and Copilot passed 30 million paid seats along the way. CFO Amy Hood noted that demand continues to exceed available supply.
The debate comes down to what an investor is willing to pay for. Apple's premium multiple covers a quarter that refunds partly lifted, plus memory cost headwinds building up. Microsoft's cheaper multiple draws support from its $678 billion backlog and cloud business compounding at double-digit rates.