At a Glance: The Q·Score
Microsoft edges Amazon by the narrowest of margins — 8.7 ("Very Bullish") versus 8.6 ("Very Bullish") — a gap of just 0.1 points. Both scores sit near the top of the Q·Score scale, which means the underlying data across all five dimensions is broadly strong for each company. A gap this small signals that the two stocks are genuinely competitive across the board; the interesting story here is not the headline gap but which specific dimensions pulled each ticker ahead, and by how much.
Quality — Profitability and Capital Efficiency
The data gives the edge to MSFT on Quality.
Microsoft's net profit margin — the percentage of revenue that becomes actual profit after all costs — stands at 39.3%, compared to Amazon's 12.2%. That is a substantial structural difference: for every $100 of revenue Microsoft brings in, roughly $39 flows through to the bottom line; for Amazon, that figure is closer to $12. Return on equity (ROE — a measure of how efficiently a company generates profit from shareholders' capital) reinforces the picture: Microsoft's ROE is 34% versus Amazon's 24.3%. Free cash flow yield data was not separately provided, but the margin and ROE figures alone are enough to give Microsoft a clear lead on this dimension. Amazon's lower margins partly reflect its continued heavy investment in logistics, fulfilment, and cloud infrastructure — a structural feature of its business model rather than a sign of operational weakness.
Health — Balance Sheet and Execution
The data gives the edge to MSFT on Health.
Microsoft's EPS beat rate — the proportion of recent quarters in which reported earnings per share exceeded analyst expectations — is a perfect 100%, compared to Amazon's 75%. Consistently beating analyst estimates signals a management team with strong visibility into its own business and a track record of disciplined execution. Detailed debt-to-equity and current ratio figures were not included in this week's dataset, so a full balance sheet comparison is not possible here; however, the EPS beat rate differential alone is meaningful. Amazon's 75% beat rate is still a solid figure — three out of every four quarters coming in above expectations — but Microsoft's unblemished record on this metric gives it the Health edge in this comparison.
Growth — Revenue, Earnings, and Surprise
The data gives the edge to AMZN on Growth.
This is the dimension where Amazon's story becomes most compelling. Amazon's earnings growth of 74.8% year-over-year dwarfs Microsoft's 23.4% — a gap of more than 50 percentage points. Earnings growth of that magnitude, sustained at Amazon's scale (a market capitalisation of approximately $2.44 trillion), is a rare data point. Revenue growth also favours Amazon, though more modestly: 16.6% versus Microsoft's 18.3%, meaning Microsoft actually leads on the top-line measure. The combination of slightly slower revenue growth but dramatically faster earnings growth at Amazon suggests significant operating leverage — costs are growing more slowly than revenues, allowing a larger share of each new dollar of sales to reach the bottom line. For context, double-digit revenue growth is considered strong in both the Consumer Cyclical and Technology sectors for companies of this size, so both figures are notable.
Valuation — Price Relative to Fundamentals
The data gives the edge to MSFT on Valuation.
Forward P/E — the stock price divided by projected earnings per share over the next twelve months — is 17.2x for Microsoft versus 22.8x for Amazon. In the Technology sector, a forward P/E in the high teens is generally considered moderate for a company with Microsoft's growth profile and dominant market positions; for large-cap Consumer Cyclical and cloud-growth names, multiples in the low-to-mid twenties are more common, which contextualises Amazon's figure. Microsoft's lower forward P/E, combined with an analyst consensus price target implying approximately 42.3% upside from its current price of $390.54, gives it the Valuation edge. Amazon's consensus target implies 38.1% upside from $226.65 — also a substantial implied gap between current price and where covering analysts collectively see fair value, but slightly narrower than Microsoft's. Both stocks are trading well below their consensus price targets, which is a notable data point in its own right. On 52-week range positioning, the dataset does not include specific range figures, so no direct comparison is drawn here.
Sentiment — Analyst Consensus
This dimension is a statistical tie.
Both Amazon and Microsoft have exactly 95% of covering analysts carrying a positive rating — as close to unanimous professional enthusiasm as the data ever shows. Amazon is covered by 61 analysts; Microsoft by 54. The breadth of coverage for both names is exceptional, meaning the 95% positive ratio is based on large, statistically meaningful samples rather than a handful of opinions. What makes this dimension particularly interesting is the context: despite Amazon's dramatically higher earnings growth rate, sentiment is identical between the two stocks. This suggests the analyst community is pricing in Amazon's growth trajectory while simultaneously recognising Microsoft's superior margins and execution consistency — neither factor is being ignored.
What the Data Shows
Microsoft holds a 0.1-point Q·Score advantage over Amazon (8.7 vs. 8.6), with the gap driven primarily by Microsoft's commanding lead on Quality — a 39.3% profit margin and 34% return on equity versus Amazon's 12.2% and 24.3% — and its perfect EPS beat rate on the Health dimension. Amazon, in turn, leads clearly on Growth, where its 74.8% earnings growth rate is the single most striking number in this entire dataset. Valuation and Sentiment are effectively split, with Microsoft showing a lower forward P/E and Amazon carrying a slightly larger analyst coverage base; both stocks show substantial implied upside to consensus price targets, and both carry a 95% positive analyst rating ratio.
Explore the Full Comparison
The live, interactive breakdown — updated in real time — is available at quantify.biz/compare/amzn-vs-msft.