ChatGPT Picks Microsoft Stock Over Apple Amid Tariff Worries

ChatGPT recommends Microsoft stock over Apple stock for investing, citing stronger market performance and historical returns. Microsoft has outperformed Apple in the past decade with an annualized return of 29% compared to Apple's 24.4%. The chatbot also notes that Apple is actively working to mitigate risks related to tariffs, including making major manufacturing investments and supply chain diversification.

In the ever-evolving landscape of technology stocks, Microsoft (MSFT) and Apple (AAPL) continue to be major players. As of September 2, 2025, Microsoft has shown stronger market performance and historical returns compared to Apple. This article delves into the reasons behind this performance gap and examines the investment potential of both stocks.

Microsoft’s Outperformance

Microsoft has outperformed Apple in the past decade, with an annualized return of 29% compared to Apple's 24.4% [2]. This difference can be attributed to several factors:

1. Market Performance: Microsoft's stock has shown consistent growth, driven by strong earnings and revenue growth. The company has benefited from its diverse business segments, including cloud computing (Azure), productivity software (Office 365), and enterprise solutions.

2. Historical Returns: Microsoft's stock has historically provided higher returns to investors. The company's ability to maintain and grow its market share in key segments has contributed to its strong performance.

3. Investment in Growth Areas: Microsoft has made significant investments in growth areas such as artificial intelligence (AI) and cloud computing. These investments have positioned the company for future growth and have been well-received by investors.

Apple’s Investment Potential

While Apple has not matched Microsoft's performance, it still offers significant investment potential. The company has taken steps to mitigate risks related to tariffs, including major manufacturing investments and supply chain diversification. Apple's strong balance sheet and cash flow position provide a solid foundation for future growth.

1. iPhone Segment: Apple's iPhone segment remains a significant revenue driver. The upcoming iPhone 17 launch is expected to provide another catalyst in Q4 2025, with analysts projecting sales exceeding $100 billion for the holiday quarter alone [1].

2. Services Segment: Apple's services business continues to deliver record-breaking results, now firmly established as the second-largest revenue driver after iPhones. This segment carries higher margins and provides recurring revenue streams.

3. AI Strategy: Although Apple has faced delays in its AI strategy, the company is actively working to catch up. Reports suggest that Apple may lean on Alphabet’s Gemini AI model to bridge gaps, indicating a commitment to innovation.

Conclusion

Both Microsoft and Apple offer compelling investment opportunities, but Microsoft's stronger market performance and historical returns make it a more attractive choice for investors. Apple, however, continues to be a solid investment with a strong balance sheet and cash flow position, as well as significant growth prospects in its iPhone and services segments.

References

[1] https://www.ainvest.com/news/strategic-implications-trump-tariffs-global-trade-equity-markets-2509/
[2] https://www.tradingnews.com/news/apple-stock-forecast-nasdq-aapl-at-232-usd