Apple is worth its mega market cap

SAN FRANCISCO -- Have technology investors gotten caught up in too much Apple hype?

It's a fair question, given the company's current market value of $772 billion is roughly equal to that of Microsoft and Google combined.

Yet given the latest quarterly results for all three companies, a fair answer is "no."

Apple's fiscal second-quarter results, released late Monday, showed that the hardware maker is trouncing the other two tech giants in all of the most important measures of financial performance.

Let's start at the top line, where Apple revenue soared 27% from a year ago to $58 billion, driven by brisk iPhone sales, especially in China.

That's 50% more than the combined sales of Microsoft, at $21.7 billion, and Google, which had $17.3 billion in revenue for the quarter ended in March.

And Apple was not only bigger, it grew more than twice as fast as the search giant and four times as fast as Microsoft.

A look at the bottom line shows the Cupertino, Calif.-based icon absolutely spanked its nearest rivals.

Apple's net income soared by a third from a year ago, to $13.6 billion.

That compares to much-slower profit growth at Google, where quarterly net income rose just 4% to $3.6 billion.

The Mountain View, Calif.-based Internet giant is pouring investment into everything from WiFi networks to automated cars.

Microsoft, meanwhile, saw its net income drop 12% to $5 billion, as sales of its cloud (or Internet-based) software prove less profitable than traditional sales of Office and Windows.

Apple's income from operations, which excludes any special items and is a good barometer of a company's core business, tells a similar story.

That metric surged 34% from a year earlier, to $18.3 billion.

Google's operating income, meanwhile, rose 8% to $4.4 billion, or about less than one-fourth Apple's total.

By that measure, too, Microsoft had the weakest quarter among the three most-valuable tech companies.

It's operating income fell 5.4%, to $6.6 billion.

The same was true of cash generated by operations, where Apple's $52.8 billion dwarfed that of both Microsoft and Google.

No surprise then that with a hoard of $194 billion, Apple has more cash and investments than Microsoft ($95 billion) and Google ($65 billion) combined.

Apple's market value is just shy of the combined value of Microsoft and Google, which were worth $394 billion and $385 billion, respectively.

In after-hours trading after Apple's results were released, its stock reached a new record high, in part because the company also added another $70 billion to its stock buyback program.

Based on the current state of its business, Apple bulls can make a strong argument that its shares should be worth even more than its two smaller rivals combined.

John Shinal has covered tech and financial markets for more than 15 years at Bloomberg, BusinessWeek,The San Francisco Chronicle, Dow Jones MarketWatch, Wall Street Journal Digital Network and others. Follow him on Twitter: @johnshinal.