Microsoft vs. Alphabet: What Their Revenue Trends Tell Investors
Key Points
Alphabet consistently maintains a larger revenue base than Microsoft, generating higher top-line results throughout every reporting period analyzed.
Both companies display a steady upward trajectory, though they each occasionally post a slight quarter-over-quarter decrease before resuming long-term growth.
Retail investors should watch whether the consistent revenue gap separating the two companies gradually expands or starts to compress over the next several quarters.
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Microsoft: Steady Revenue Progression
Microsoft (NASDAQ:MSFT) develops and licenses software, digital services, and cloud computing solutions for global enterprises and consumers.
It recently entered a long-term power agreement with Chevron to support its data centers while facing a class-action lawsuit, and it reported 38% net income margin for the quarter ended March 31, 2026.
Alphabet: Maintaining a Larger Revenue Base
Alphabet (NASDAQ:GOOGL) provides a diverse range of digital platforms, advertising solutions, and cloud services to global consumers.
The company executed a large equity capital raise and introduced several technological updates at its developer conference. It generated 57% net income margin for the quarter ended March 31, 2026.
Why Revenue Matters for Retail Investors
Revenue serves as a foundational measure of total money generated by core business operations before deducting expenses. Tracking this metric helps investors measure a company's total customer sales volume and baseline growth trajectory over time.
Quarterly Revenue for Microsoft and Alphabet
| Quarter (Period End) | Microsoft Revenue | Alphabet Revenue |
|---|---|---|
| Q2 2024 (June 2024) | $64.7 billion | $84.7 billion |
| Q3 2024 (Sept. 2024) | $65.6 billion | $88.3 billion |
| Q4 2024 (Dec. 2024) | $69.6 billion | $96.5 billion |
| Q1 2025 (March 2025) | $70.1 billion | $90.2 billion |
| Q2 2025 (June 2025) | $76.4 billion | $96.4 billion |
| Q3 2025 (Sept. 2025) | $77.7 billion | $102.3 billion |
| Q4 2025 (Dec. 2025) | $81.3 billion | $113.9 billion |
| Q1 2026 (March 2026) | $82.9 billion | $109.9 billion |
Data source: Company filings. Data as of June 23, 2026.
Foolish Take
Microsoft and Google parent Alphabet are two of the premier companies worth investing in for those seeking stocks in the technology and artificial intelligence sectors. As the data above reveals, both are enjoying a trend of strong, sustained revenue growth. This suggests their businesses are thriving as AI injects new life into their offerings.
Even so, Microsoft and Alphabet experienced share price declines recently due to the substantial sums they are spending to build up the infrastructure needed to support their AI systems. The situation creates a buy opportunity for investors.
Although purchasing shares in both is ideal, if you have to choose one, my recommendation is Microsoft. Its stock fell to a 52-week low of $349.20 on June 25. As a result, Microsoft’s forward price-to-earnings ratio is 18, below Alphabet’s 24, indicating Microsoft stock is the better value.
In addition, although both pay a dividend, Microsoft's dividend yield is far greater at 1% compared to Alphabet’s tiny 0.26%. This passive income adds to your total return.
Wall Street may be punishing Microsoft shares right now, but the company is doing well as the revenue data above illustrates. For example, sales in its fiscal third quarter, ended March 31, were $82.9 billion, representing strong 18% year-over-year growth. With its trend of rising revenue and a respectable dividend yield, Microsoft is looking like an attractive stock to buy right now.
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Robert Izquierdo has positions in Alphabet and Microsoft. The Motley Fool has positions in and recommends Alphabet, Chevron, and Microsoft. The Motley Fool has a disclosure policy.
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