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Apple may make more profit selling one Mac than HP does from 7 PCs - Page 4

post #121 of 188
Quote:
Originally Posted by rickag View Post

For those arguing this is an example of the Apple tax, your argument is fundamentally flawed.

The article is comparing all HP computers versus all Apple computers for dollar profit.

Apple doesn't sell $299 computers with razor thin margins.

The question you should ask yourself is what is the dollar profit for HP on comparably priced computers.

Using the largest selling model for Apple:

The low end iMac starts at $1199 and goes up to $1999. Do you really think HP only makes $52 on comparably priced computers really, I mean really do you?

Thanks for saving me the trouble of typing this! I'll just add that if I recall correctly, Apple has made it clear that their business model includes cutting out the things that suck. I doubt these other PC makers share that mindset, but if they did, I think the gap would shrink.
post #122 of 188
Quote:
Originally Posted by phoebetech View Post

For all I know all of those donations could have gone to the Church of Scientology which still qualifies for 501c! I wish there were more details.

I'm sure if you did a little investigative digging, you could find out where the money is going. But if you keep the cynical route, then you can always assume that any reports you got were forged or doctored or redacted or straight up fabricated. I prefer to be optimistic and assume/hope that the money is going to worthy causes. Though "worthy cause" means different things to different people. Back when Prop 8 was being debated in California, Apple put their corporate weight behind the "anti-Prop 8" campaigns. Now, if you're gay/lesbian/etc. and you want the right to marry in California, then you'd probably consider that a "worthy cause". If you're against gay marriage, then you wouldn't. Likewise, if you're a scientologist, and an Apple exec gave money to the Church of Scientology, I'm sure you'd be pretty happy about that. If you think scientologists are a bunch of loons, then you probably wouldn't be happy if that were the case.
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post #123 of 188
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post #124 of 188
Quote:
Originally Posted by cloudgazer View Post

You completely misinterpreted me then. I wasn't seeking to imply that Apple's investors weren't philanthropic, or that its employees weren't - I was trying, apparently unsuccessfully, to criticize the concept of 'corporate philanthropy' where a corporation does good by giving money.

My point here is that it's equivalent to the two of us walking down the street together and seeing a homeless man. I feel sorry for him, so I pick your pocket, take 20 from your wallet, and give it to the homeless guy.

Giving away money that isn't mine isn't philanthropy, and corporations hold their money in trust for their shareholders, so by definition it isn't theirs to give away.

Hmmm.. I don't agree with the "pickpocket" analogy. Shareholders willingly invest in a companythe company doesn't pick anyone's pockets. If enough shareholders didn't like what the company is doing with their money, then they can vote at a shareholder's meeting and get things changed. Now, I suppose if the "minority" of shareholders don't want Apple giving money to the homeless guy (to stick with your analogy), they might feel like they've been pickpocketed. In which case, they can always sell their shares and invest in a more "profit-minded" companythat won't give to a homeless guy. Or, conversely, if the "minority" of shareholders, want they company to give to the homeless guy, but the majority say "Screw the homeless guy, we want our dividends!!", again, the minority can sell their shares, and invest in a more "ethical" companyone that's more in line with their leftist/pinko/socialist/tree-hugging values*. But, a smart/savvy investor will have a pretty good idea of what his/her money is doing. For me, as an Apple investor, I'd be thrilled to know that Apple is giving money to homeless guys.

* <snark>

I guess we'll have to agree to disagree on this "corporate philanthropy is a contradiction" thing.
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post #125 of 188
Quote:
Originally Posted by AppleInsider View Post

Richman recalled that Apple amassed $4.976 billion in revenue from the sale of 3.76 million Macs during its previous quarter, yielding an average selling price of $1,323.40 per Mac. He then multiplied that figure by an 28% gross margin estimate for Mac sales from Jefferies & Co. -- which is still several hundred basis points below the company's reported average -- to arrive at a profit of $370.55 per Mac sold.

By comparison, HPs Personal Systems Group brought in $9.415 billion in revenue and turned a profit of $533 million last quarter. The PC maker's operating margin, which doesnt factor in overhead costs, came in at 5.66%.

"If we assume they spent 1% of their $9.415 billion in revenue $94.15 million on operations, then their profit margin was 6.66%," Richman wrote. "But lets give them the benefit of the doubt and make it 8%."

Why in the world are they comparing Apple's GROSS MARGINS to HP's OPERATING MARGINS?

(admittedly, they're making up an operating overhead number for HP, but that simply increases the error. Why not compare published gross margin to published gross margin or compare published net to published net?
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post #126 of 188
Quote:
Originally Posted by MacRulez View Post

To recap:

Bill Gates: $220 million +
http://en.wikipedia.org/wiki/Bill_%2...dation#History

Warren Buffet: $30 billion
http://en.wikipedia.org/wiki/Bill_%2...ffett_donation

Combined Apple Executives: $6.4 million
http://www.macnews.com/2010/12/31/so...able-donations

Hooray! Lots of people gave lots of money!
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post #127 of 188
Quote:
Originally Posted by MacRulez View Post

To recap:

Bill Gates: $220 million +
http://en.wikipedia.org/wiki/Bill_%2...dation#History

Warren Buffet: $30 billion
http://en.wikipedia.org/wiki/Bill_%2...ffett_donation

Combined Apple Executives: $6.4 million
http://www.macnews.com/2010/12/31/so...able-donations

Nothing can be deduced from this.

Gates and Buffet choose to publicize their charitable activities.

The Apple executives mentioned were just donating fully appreciated stock and as high-ranking insiders had to disclose these transactions. Rank-and-file employees would not have to disclose these transactions publicly.

Also, there is nothing preventing Apple employees from selling their shares on the open market, paying capital gains, then donating some or all of the proceeds to charity (which could be done anonymously).

There are people who do not want to be publicly identified as contributing to a charity. If you look at any arts program (symphony, ballet, opera, museums, etc.), you will typically see multiple anonymous contributors at every donation tier.

Apple is a notoriously secretive company, and it is likely that it would attract a fair number of employees who have a similar mindset and thus would result in a higher population of people who donate anonymously.
post #128 of 188
Quote:
Originally Posted by Futuristic View Post

Now, I suppose if the "minority" of shareholders don't want Apple giving money to the homeless guy (to stick with your analogy), they might feel like they've been pickpocketed. In which case, they can always sell their shares

That's not how minority shareholder rights work. You have more than the right to sell. Management is supposed to act in your best interests. Now a corporation can give money to charity in order to enrich its shareholders, for example it can do it for PR, or it can do it to build a market, there are lots of reasons why a corporation might give. But love of humanity isn't one of them, a corporation cannot love.
post #129 of 188
Quote:
Originally Posted by cvaldes1831 View Post

Nothing can be deduced from this.

Gates and Buffet choose to publicize their charitable activities.

The Apple executives mentioned were just donating fully appreciated stock and as high-ranking insiders had to disclose these transactions. Rank-and-file employees would not have to disclose these transactions publicly.

Also, there is nothing preventing Apple employees from selling their shares on the open market, paying capital gains, then donating some or all of the proceeds to charity (which could be done anonymously).

There are people who do not want to be publicly identified as contributing to a charity. If you look at any arts program (symphony, ballet, opera, museums, etc.), you will typically see multiple anonymous contributors at every donation tier.

Apple is a notoriously secretive company, and it is likely that it would attract a fair number of employees who have a similar mindset and thus would result in a higher population of people who donate anonymously.

Thank you. That's what I meant to say.
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post #130 of 188
Quote:
Originally Posted by cloudgazer View Post

a corporation cannot love.

Oh, there is soooo totally a dystopian sci-fi melodrama in there!

"The Corporation That Could Not Love" <weep> <sniff>

Person: I love you, Apple.
Apple: Alas, I cannot love you back, for I am a corporation, and hence, am incapable of love.
Person: NOOOOOOOO!!! Why, God WHYYYYY???
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post #131 of 188
Quote:
Originally Posted by Futuristic View Post

Oh, there is soooo totally a dystopian sci-fi melodrama in there!

"The Corporation That Could Not Love" <weep> <sniff>

Ooh - with a 70s style voice over on the trailer?
post #132 of 188
Quote:
Originally Posted by cloudgazer View Post

Ooh - with a 70s style voice over on the trailer?

Yeah!

Incidentally, I like the link in your signature.

XKCD—FTW!
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post #133 of 188
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post #134 of 188
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post #135 of 188
I can't afford a Ferrari but I'm not going to cry over it.
post #136 of 188
Quote:
Originally Posted by Futuristic View Post

Oh, there is soooo totally a dystopian sci-fi melodrama in there!

"The Corporation That Could Not Love" <weep> <sniff>

Person: I love you, Apple.
Apple: Alas, I cannot love you back, for I am a corporation, and hence, am incapable of love.
Person: NOOOOOOOO!!! Why, God WHYYYYY???

Actually, it works better as a Mexican soap opera (thank you Google translate!):

Person: Te quiero, Apple.
Apple: ¡Ay, no te puedo amar de nuevo, porque yo soy una empresa, y por lo tanto, soy incapaz de amar.
Person: NOOOOOOOO! ¿Por qué, Dios, Por qué??

disclaimer: It's been about a decade since I've spoken a word of Spanish, so I don't know if it's correct.
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post #137 of 188
Quote:
Originally Posted by MacRulez View Post

Sure, it's not impossible that Apple collectively might give away as much as 10% as Warren Buffet.

Theoretically.

But as Wired points out, that would be extremely rare for high-level corporate execs. Not impossible, just unlikely.

It may also be theoretically possible that you could win the lottery tomorrow and donate all of it to charity.

Again, possible, just not likely.

If Apple execs want to take control of this very frequently-cited meme by divulging any significant contributions, they're free to do so. The choice is of course theirs.

And it may also be the case that there just aren't any contributions to discuss other than the ones already mentioned.

As you say, there's no way to know.

True, there is no way to know, however it is likely that there are other contributions. However, most of these would fly under the radar.

Apple (and other Silicon Valley companies) typically grants stock options to their employees as incentives or awards, not actual shares. These options must be exercised to have any value; the applicable taxes can be substantial, so many times the shares are sold right away. Any proceeds from an exercised stock option that are donated to charity would not have to disclosed publicly.

Steve Jobs doesn't have any shares of Apple right now. He has a bunch of options, but they're worthless until exercised.
post #138 of 188
Quote:
Originally Posted by jragosta View Post

Why in the world are they comparing Apple's GROSS MARGINS to HP's OPERATING MARGINS?

(admittedly, they're making up an operating overhead number for HP, but that simply increases the error. Why not compare published gross margin to published gross margin or compare published net to published net?

Quote:
Originally Posted by MacRulez View Post

Because he's 15 years old and has no idea what he's talking about?

HP did not publish the gross margin of the Personal Systems Group (reason kind of obvious), only the operating profits. Rather clever for a 15-yr old (or anyone) to estimate the gross margin the way he did.
post #139 of 188
Quote:
Originally Posted by ddawson100 View Post

Apple tax? I'm pretty sure Microsoft makes more selling each copy of Windows than Apple does with their OS. C'mon.

The MS tax is even worse. If only I could live with Linux. But I live with Mac...
post #140 of 188
Quote:
Originally Posted by ClemyNX View Post

This only shows how Apple makes their products too expensive.


Actually what it shows is that Apple knows how to make an incredible return on investment. They produce a very high quality product, market and sell it brilliantly and keep the consumer backed up in every way imaginable. Genius Bar anybody?
post #141 of 188
Quote:
Originally Posted by Futuristic View Post

Actually, it works better as a Mexican soap opera (thank you Google translate!):

Person: Te quiero, Apple.
Apple: ¡Ay, no te puedo amar de nuevo, porque yo soy una empresa, y por lo tanto, soy incapaz de amar.
Person: NOOOOOOOO! ¿Por qué, Dios, Por qué??

disclaimer: It's been about a decade since I've spoken a word of Spanish, so I don't know if it's correct.

Ok ok! stop! you won the thread already!
post #142 of 188
Quote:
Originally Posted by cvaldes1831 View Post

True, there is no way to know, however it is likely that there are other contributions. However, most of these would fly under the radar.

Apple (and other Silicon Valley companies) typically grants stock options to their employees as incentives or awards, not actual shares. These options must be exercised to have any value; the applicable taxes can be substantial, so many times the shares are sold right away. Any proceeds from an exercised stock option that are donated to charity would not have to disclosed publicly.

Steve Jobs doesn't have any shares of Apple right now. He has a bunch of options, but they're worthless until exercised.

I guess the best measure is to see how they treat their own employees. I think that would show how much they really care about giving back. I really do hope they do treat their employees well but I never hear anything about that other than the Apple bus which most Tech Companies in Silicon Valley already have. I know that some store employees are trying to form a union which shows there is discontent in that area.
post #143 of 188
Quote:
Originally Posted by phoebetech View Post

I guess the best measure is to see how they treat their own employees. I think that would show how much they really care about giving back. I really do hope they do treat their employees well but I never hear anything about that other than the Apple bus which most Tech Companies in Silicon Valley already have. I know that some store employees are trying to form a union which shows there is discontent in that area.

When I lined up for my iPhone last summer, there was this Apple specialist who patiently and repeatedly talked to people in the queue, giving us updates every 15 - 30 min, taking down our hopeful orders. He took the occasional break but then came right back. I came back another day to line up again to get phones for my kids, and there he was doing the same thing, just as tirelessly. I told him that he was rather admirable and that I hoped he was getting overtime. He said, "Nope. But most of us working here are passionate believers in the company." That says a lot.

Another sign that the company is treating its employees ok? Despite recent departures (Serlet and Johnson), the senior team, all of whom could become CEOs elsewhere, has remained quite static. And they only promote internally. See also how Jobs is not afraid to share the stage during the show and tells.

The flip side is that he is a legendary slave driver.
post #144 of 188
Quote:
Originally Posted by phoebetech View Post

I guess the best measure is to see how they treat their own employees. I think that would show how much they really care about giving back. I really do hope they do treat their employees well but I never hear anything about that other than the Apple bus which most Tech Companies in Silicon Valley already have. I know that some store employees are trying to form a union which shows there is discontent in that area.

Apple's stance with its employees is to be generous with stock option grants and not to spoil them with tons of amenities (e.g., their employee cafeteria is not free whereas Google's various restaurants are famously free).

That's actually a fairer way of doing things, as the amenities at the corporate headquarters don't benefit those working in a satellite office. Also, Apple gives a lot of their products to employees and offers an employee discount.

I believe Steve has actually said in a town hall meeting that he wants employees to have lots of stock; they can sell and do whatever they like with the money.

Their employee retention rate is very high. If you don't like working for Apple, chances are you will be gone shortly, like Mark Papermaster. They work hard, but so do lots of other people in Silicon Valley. It's not like they're taking three-hour lunches at Cisco.
post #145 of 188
Another sign that the company is treating its employees ok? Despite recent departures (Serlet and Johnson), the senior team, all of whom could become CEOs elsewhere, has remained quite static. And they only promote internally. See also how Jobs is not afraid to share the stage during the ]


That's not a measure because its not comparing it to the standard within silicon valley. I wonder what their employee turnover rate is like. ibm and netflix have the lowest according to several articles.
post #146 of 188
Probably hard to compare, especially if there is no breakdown between corporate and retail employee turnover. However, my guess is that it's quite low. If the turnover rate was very high, it would be heavily discussed in Silicon Valley and Apple would not be enjoying their current success. You can't be running on all cylinders if you're constantly hiring and training new people.

Apple appears to be unique to high tech in the fact that they have a significant worldwide retail sales operation (which is where most of their headcount grow has been over the past several years).

We do know that Apple corporate has not exploded in headcount. They are very cautious in adding new corporate employees.

Remember, Silicon Valley stock option grants typically take several years to fully vest. Often it's 20-25% one year after the option grant date, plus 2% every month thereafter. Once fully vested, there's a certain period (usually several years) before the options expire. Of course, if you get additional option grants, those clocks start ticking at their respective grant dates. They don't call them "golden handcuffs" for nothing.
post #147 of 188
Not to go off topic, but I got into the Mac World at HP prices, by buying used. Core2Duo MacBooks are all over the place now for $400-$500. And they are all I need right now.
post #148 of 188
Quote:
Originally Posted by MikeSmoke View Post

Not to go off topic, but I got into the Mac World at HP prices, by buying used. Core2Duo MacBooks are all over the place now for $400-$500. And they are all I need right now.

It's actually amazing how well old MBPs hold their value. Even at 3 years old they still have resale value, whereas a 3 year old HP or Dell is effectively an ugly paperweight.
post #149 of 188
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post #150 of 188
I bought a black MacBook C2D 2.0, 2gig ram, 120gig HD, and a brand new battery for $500. Got a white one with 512RAM and 60 gig HD for $350, Upgraded to 2 gig Ram for $30. And they are MacBooks with firewire. They have worked flawlessly for about a year now. Not the latest and greatest, but they do more than I need. I run some pretty pretty heavy audio stuff on the black one.
post #151 of 188
Quote:
Originally Posted by MacRulez View Post

How many of those have you purchased, and which processors?

My Dell Core 2 Duo is holding up marvelously in its fourth year.

Well you've been very lucky, but good luck trying to sell a PC of that age for more than pocket change. The processor isn't the problem, PC vendors use low quality components, wherever they can - which means motherboards, fans, keyboards etc.
post #152 of 188
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post #153 of 188
No suprise. Usually what HP makes is a heaping pile of shit, they have to make up for that in volume. Not really a comparison though, it's just typical Apple fan chest-beating.
post #154 of 188
Quote:
Originally Posted by MacRulez View Post

Buying computers as a resale investment is a poor financial decision, regardless of brand. You'll make more cash from darn near any other investment.

No kidding! With the rate of hardware advancement every six months, buying a computer with considerations of what it's worth will be in a few years to make back some money is just foolish. What possess people to not use something until it is either dies completely or can't be fixed for less than or equal to it's worth just blows my mind. I know people who trade in cars every two to five years to get the newest thing. That's just nuts. Use something until it dies or your needs drastically change.
post #155 of 188
Quote:
Originally Posted by MacRulez View Post

So you haven't actually owned PCs yourself?

Of course I have, there's one sitting in my living room as a blu-ray source even now.

Quote:
Buying computers as a resale investment is a poor financial decision, regardless of brand. You'll make more cash from darn near any other investment.

Did I suggest that you should? The fact is that if you want to buy an old MBP you can, but it will cost you almost as much as a new HP laptop. The depreciation is lower, in much the same way as the depreciation is lower on a BMW than a Ford. Nobody is suggesting that you buy BMWs as an investment either.

I've no idea how long you can make a PC last but you're clearly a wiz with a straw man.

Here's an example http://cgi.ebay.co.uk/apple-macbook-...#ht_1954wt_961

That laptop is pretty much an antique at this point, pre unibody design - pretty much the oldest thing you could buy that would support lion - and it would still cost you £110.

http://cgi.ebay.co.uk/Apple-MacBook-...3#ht_500wt_901

This one is even older, won't support lion and the vendor is hoping for more than £300! And people will actually pay it - yes I think that's remarkable.
post #156 of 188
I am using an HP now, and you get what you pay for. I suppose Apple is making up for the fact they lost money on sales of each Mac in the 90s, about the time they almost failed. Apple ... Either boost the power of the mini, or scale down the Pro.
post #157 of 188
Quote:
Originally Posted by shovelheadrider72 View Post

What about the operating systems? I am sure that HP is having to pay for Windows where as Apple is including the operating system for free.

The 'Apple Premium' is hardly 'free', but I get where you're coming from. Macs are expensive because there really is no other system that provides 'computing done right', oddly enough. Since Apple has no real competition in its core value proposition, it can charge whatever the market will bear, and to hell with marketshare.

It's funny that Macs are compared to 'luxury' cars - because the comparison breaks down. Macs don't provide luxury or prestige, they are simply the only computer company that provides basic functionality. The correct analogical comparison is not between a compact car and a luxury sedan - it's more between a 'car' that is a conglomerated mongrel of poorly-fitting parts that frequently breaks down, is theft-friendly, and wildly unsafe to a car that simply 'works'.
post #158 of 188
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post #159 of 188
Quote:
Originally Posted by MacRulez View Post

Try that with a Mac.

Okay. Done. Next?

Quote:
Precisely, and indeed the point of this article: Macs cost a LOT more than PCs, more than twice as much on average. New or used there's no way to escape that.

Fortunately, the cost is offset by them lasting years longer on average as primary machines.

Quote:
HP cut corners to save more than $5 billion, while Steve performed tasks on his unsuitable-for-inhabitation mansion that have absolutely nothing to do with this argument, nor with the amount of money that Apple receives from sales.

Fixed!

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
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Originally posted by Relic

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post #160 of 188
Quote:
Originally Posted by xSamplex View Post

Just because they sell these things (with like a 9% market share) does not mean they are fairly priced. They are expensive, and that is reflected in the market share.

Fair pricing is what people will pay. If you can't afford it, don't buy it.
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