In the December business quarter, Apple’s iPhone business generated $24,4 billion of revenue. Microsoft’s whole company, from Windows to Office to servers to Xbox, generated just $20,9 billion.

One should never assume things, but if we assume that Apple generates the same operating profit margin on its iPhone business as it does on its overall business, 38%, then the iPhone business generated about $9,3 billion of profit in the December quarter.

All of Microsoft generated only $8,2 billion. Overall, Apple’s business is more than twice the size of Microsoft’s now: $46 billion compared to $21 billion. It’s also more than twice as profitable: $17 billion to $8 billion.

What’s just as extraordinary here is that Apple invented the iPhone business just five years ago.

Microsoft seems to have failed in two big ways: they just plain grossly underestimated and missed the iPhone and iPad markets, which Apple created.

Here’s Steve Ballmer, Microsoft’s famous CEO, having a dig at the iPhone:

And, Microsoft pumped billions into its fight against Google: it’s been pumping nothing short of $2 billion a year into the effort.

[Source: BusinessInsider]