The VAR Guy recently reported that Google‘s revenues aren’t really gaining ground on Microsoft‘s annual revenues, based on nearly a decade of financial data. Now, our resident blogger is back with an update — this time looking at GOOG vs. MSFT annual net income since 2002. Here again, the results may surprise you.
The data for Google and Microsoft historic net income, covering 2002 through 2010, comes from Wikinvest.
Annual Net Income: GOOG vs. MSFT ($Billions)
| Year | Microsoft | Microsoft Lead | |
| 2002 | $0.10 | $7.83 | $7.73 |
| 2003 | $0.11 | $9.99 | $9.89 |
| 2004 | $0.40 | $8.17 | $7.77 |
| 2005 | $1.47 | $12.25 | $10.78 |
| 2006 | $3.08 | $12.60 | $9.52 |
| 2007 | $4.20 | $14.07 | $9.87 |
| 2008 | $4.23 | $17.68 | $13.45 |
| 2009 | $6.52 | $14.57 | $8.05 |
| 2010 | $8.51 | $18.76 | $10.25 |
What the Data Shows
No doubt, Google’s net income grew far more impressively and far more consistently vs. Microsoft’s net income from 2002 through 2010. But Microsoft is no slouch, delivering $18.76 billion in net income vs. $7.83 billion in 2002. Plenty of rivals would welcome those figures.
Also, look at that column on the far right — which measures Microsoft’s annual lead on net income. In 2002, Microsoft’s net income outpaced Google’s net income by $7.73 billion. By 2010, Microsoft had grown its annual net income lead over Google to $10.25 billion.
What do the numbers show? Admittedly, past results don’t guarantee future success. Google has been far more reliable on net income growth. But The VAR Guy suspects quite a few people have overlooked just how profitable Microsoft remains… easily out-muscling event Google… at least through 2010.
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But you left off the column that compares the Google income as a percentage versus the Microsoft income.
Frank: Fair point. So you’re looking for Google net income vs. Google revenues (percentage), compared to Microsoft net income. vs. Microsoft revenues (percentage)? Let The VAR Guy know and he’ll get the data.
-TVG
TVG:
Those numbers, yes — but also Google net income vs Microsoft net income. As we know, all that matters is what you take home…
Dave
Dave: Yes, indeed, the figures in the blog above are annual net income for both MSFT and GOOG, in billions… Both companies continue to take home quite a lot…
-TVG
Got it. The percentages then of total revenue do matter then too.
@TVG
Actually was thinking of something even simpler that just shows your original figures from a different perspective, e.g. Google annual net income as a % of Microsoft annual net income.
These show a massive growth spurt for Google that flattened from 2009 to 2010. What will also be interesting is whether or not Google can regain momentum and continue to increase its growth relative to Microsoft’s growth.
For Google to achieve this it will be essential that it start to wean users off Microsoft Office, that in my experience is the single biggest obstacle for users to move from a Microsoft ecosystem.
Frank, Dave: The VAR Guy is going to pretend to log off for a bit. But at some point in the next couple of days our resident blogger will return to offer the stats you’ve requested.
-TVG