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Apple's 2012 profits forecast to be highest of any public company ever

post #1 of 113
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This year, Apple could generate the highest annual net income of any publicly traded company in history, according to one Wall Street analyst.

Brian White with Topeka Capital Markets said in a note to investors Monday that he has heard analysts and market pundits over the last several weeks discuss the point of a $500 billion market cap as a barrier to further price upside at companies in the past. Some on Wall Street have theorized the $500 billion market cap threshold is a "barrier" for stocks.

These people are concerned that a similar scenario could happen with Apple, preventing the company from pushing much further past the $500 billion mark. As of Monday morning, Apple's market cap was at about $545 billion.

The line of thinking among some on Wall Street is that companies that exceed $500 billion in market capitalization have trouble growing much beyond that point. But White believes Apple's market cap potential in trillions of dollars, not billions.

"We went back and analyzed five U.S.-based companies that at one time enjoyed market capitalizations of (about) $500 billion or more, but found little similarities with Apple," he wrote.

Those five companies were Cisco Systems, Exxon-Mobile, General Electric, Intel, and Microsoft. With the exception of Exxon, these companies had rich price-to-earnings ratios when they crossed the $500 billion mark, and the tech companies had what White called "monopoly-like market share positions."

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But Apple does not have a stranglehold on most markets where it competes. Instead, there is plenty of room for growth in the booming smartphone market.

"Microsoft held over 90% market share for PC operating systems at the peak cap, while Cisco had over 70% share in the networking market and Intel had over 80% of the PC processor market," White said. "By comparison, IDC estimates that Apple held just 4.7% of the PC market in (the first quarter of 2012) and 8.8% share in the mobile phone market."

Apple's iPad does dominate in the tablet market, with an estimated 68 percent share of shipments in the first quarter of 2012, but White noted that it's a market category that Apple invented.

White expects that in calendar year 2012, Apple is poised to generate the highest profits of any publicly traded company ever. Compared to the "big three" technology companies that have exceeded a $500 billion market cap, he believes Apple's net income will over over six times higher on an individual basis to when those companies were at their respective peaks.

In addition to its relatively low market share, Apple stock is currently trading at just 8.4 times White's estimates for calendar year 2013 earnings per share, excluding cash. In comparison, the three technology companies that have crossed the $500 billion threshold — Microsoft, Intel and Cisco — had price-to-earnings ratios of over 80 times.
post #2 of 113

I think we're years yet away from the time when we're not blown away by Apple's growth and earnings.

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post #3 of 113

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare?

 

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

 

Even if Apple lowers margins on Macs to 10%, it will not hurt their bottom line in a significant way. And in all likelihood, the resulting increase in sales will more than make up for the lower margins.

post #4 of 113
Quote:
Originally Posted by JerrySwitched26 View Post


Apple's phone business is currently the biggest single source of profits.  In my opinion, the market has a huge growth potential as emerging markets shift to smartphones and Apple continues to market older models (which have a low marginal cost) to these new markets.  Apple has solid products at various price points in the phone game.  Not only are they well positioned to capture sales in new markets, even established markets are experiencing double-digit rates of conversion to smartphones, and in these markets, Apple can  sell huge numbers of its latest and greatest iterations at early-adopter prices.

With tablets, things are much less clear.  Apple currently dominates, and so, only a growth in the market itself could result in greatly increased sales for Apple.  Will the tablet market grow as fast as smartphone market?  Will margins remain attractive, like they have in the phone biz?  Time will tell.  


The PC market is not going to grow nearly as fast as the smartphone or the tablet markets.  It is not a prime source of profits anymore.  Apple can concentrate on niches within the overall market, but overall, there's less potential.

The tablet market has a long way to go before growth slows to low double digits. I can see the market supporting well over a 500 million a year sales level, with Apple having a very large portion of that, possibly even a majority, particularly if they do come out with a smaller less expensive 7.85" model.

And don't forget that while Windows PC growth is slowing and even shrinking at times, Apple's Mac growth is still solid.

And we don't know where else they may be going.

With the agreement with at least 9 major auto makers to put a Siri button on the steering wheel (a major, and shocking development according to friends in the auto business), Apple is getting in front of that business. How far it will go is anyone's guess right now, but we can be sure that Apple has plans for this that go further than it may now seem.

Then there is what seems to be the age old question of an actual Tv of some kind. Estimates are that if Apple gets just 2% of the Tv market, that could be $11 billion that year for them. If their sets cost the $2,000 average predicted, it could be more than 2%, as $2,000 is just the average price for a large screen advanced model, which go over $4,000.
post #5 of 113
Off topic: I think it'll be the same people that will claim "Steve would have never done this" for anything Apple does that don't like (even if it happened during his watch), and that any positive changes that Apple makes since Steve's passing will be the result, not of Tim Cook's leadership of other people at Apple, but actions Steve put in place before he stepped down as CEO. Even if Apple becomes the first trillion dollar publicly traded company it'll just a be a fluke and/or have nothing to do with the current efforts from Apple. Can Apple ever win?

Quote:
Originally Posted by melgross View Post

And don't forget that while Windows PC growth is slowing and even shrinking at times, Apple's Mac growth is still solid.

I am expecting to see a new Mac campaign this year. ML launching less than a year after Lion, almost all Macs updated this summer, amazing changes to the MBP that can't be met by other vendors, and Win8 being a complete logistical mess for users tell me it's perfect storm to increase Mac growth even faster.

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post #6 of 113
Before someone else says it, Apple did not invent the tablet category. What they did invent was the first usable, attractive tablet.

This category that they did invent will grow to take over most of the PC industry, because it's what more people need in more places. It will take over the book and magazine industry as well, maybe also news and TV. Huge growth lies ahead.

The phone category is really the pocket computer category, or better, the pocket communication and knowledge terminal. Everyone in the world is the market for these.

The next category is wearable. Eyeglass screens, eyeglass cameras, etc.

Old concepts of growth limits do not apply to a company that is behind a new industrial revolution. Actually a new postindustrial revolution that doesn't even have a name yet, as far as I know. The Tofflers' Third Wave doesn't capture what we're dealing with. It's unprecedented, so new horizons in thought are called for.

Edit: I see Mel Gross tossing out 500 million a year for tablets. I don't know about that kind of number, but that's the kind of talk we ought to be seeing. The future is huge.

Edit 2: At this point, we can say that Apple shows the computer industry to really be the communications, knowledge and arts/entertainment industry. It has been doing this from the garage days, still doing it, humanizing the Turing machine. Other companies give this humanizing only lip service, while they're bound by engineering, not art or even much design.
Edited by Flaneur - 6/18/12 at 9:59am
post #7 of 113
Quote:
Originally Posted by macarena View Post

Then why don't they lower their margins and make a play for increased marketshare?

 

Uhm, while I agree that Apple could lower their profit margins somewhat to drive adoption rates in several areas, I don't think the Macs are the prime candidate here. Look at the MacBook Air or the iPad, no one else can match the quality and the prices there so far.

 

I do understand your argument about the entry price for developers, but a used Mac Mini can be had for less than $500 these days and you don't need the latest and greatest to code...
 

post #8 of 113

Once again the evidence shows the market is utterly incapable of figuring out how to value Apple.  In any fundamental sense, Apple is a huge bargain by integer multiples in value, at less than X10 EPS and has huge profits going forward and similar over the last 16+ quarters!! It has terrific growth opportunities in all markets its involved.  Yet Amazon and Facebook have huge EPS with little to no profit and to support their valuation.  

 

Is this because Apple is so unique, markets treat Apple like a series of one off successes [imac, iPod, iPhone, Macbook Air, iPad, ...] and so are waiting for the bust, manufacturing/hardware can't be this successful for this long [its a freak of nature], it violates all the MBA training [Clay Christensen'c view all successful companies are doomed because of MBA training], ....?

 

Is Apple's model learnable and can it be duplicated by others across a wide range of products and industries?  Doubtful, but does anybody understand it to teach it?

post #9 of 113

Spring 2015 : Tim announces that from now on, the Apple enormous cash resulting from recurrent revenues driven from immaterial content (advertising, music, films, press ..) enable the company to distribute its electronic consumer products at 99 cents unique price (at this point, the French people, who always like to complain, argue that this is unfair, because 99 Euros cents are a lot more than 99 US $ cents.

 

At this point, analysts just give up : recognizing that they will never understand Apple business, except that it is exceptionnaly profitable, they simply strongly advise to buy Apple shares at any price.

post #10 of 113
Quote:
Originally Posted by melgross View Post

With the agreement with at least 9 major auto makers to put a Siri button on the steering wheel (a major, and shocking development according to friends in the auto business), Apple is getting in front of that business. How far it will go is anyone's guess right now, but we can be sure that Apple has plans for this that go further than it may now seem
 
Then there is what seems to be the age old question of an actual Tv of some kind. Estimates are that if Apple gets just 2% of the Tv market, that could be $11 billion that year for them. If their sets cost the $2,000 average predicted, it could be more than 2%, as $2,000 is just the average price for a large screen advanced model, which go over $4,000.

 

The auto accessory market has huge potential.  I wonder if people will get dedicated 4G accounts for their cars.  If so, built in screens could provide streaming entertainment coast to coast.

 

 

I wonder what the high end sets capture as a proportion of the overall TV market.  My impression is that while there are always 70 and 80 inch displays in the TV department, the cheaper ones sell fastest.  It is a market I know little about, however.

post #11 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare?

 

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

 

Even if Apple lowers margins on Macs to 10%, it will not hurt their bottom line in a significant way. And in all likelihood, the resulting increase in sales will more than make up for the lower margins.

 

If the price of a Mac is a "barrier to developing iPhone and iPad software"... then, the developer is in the wrong business.  Hell, he needs to invest in some basic tools, even to work on his own bicycle.

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post #12 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space...

 

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed...

So, 'the barrier to developing iPhone and iPad software is significantly higher than the barrier to developing Android software'.  Does this mean that developers are leaving iOS for Android?  A couple of grand on a 27" iMac that in my case is running OS X, win 7 and Linux without fault is hardly a barrier to a developer.  I can understand your desire to have Apple take less of your hard earned money but I'd rather a successful Apple, even if I have to pay a little more, if indeed I am.

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post #13 of 113
Quote:
Originally Posted by gprovida View Post

Once again the evidence shows the market is utterly incapable of figuring out how to value Apple.  In any fundamental sense, Apple is a huge bargain by integer multiples in value, at less than X10 EPS and has huge profits going forward and similar over the last 16+ quarters!! It has terrific growth opportunities in all markets its involved.  Yet Amazon and Facebook have huge EPS with little to no profit and to support their valuation.  

Is this because Apple is so unique, markets treat Apple like a series of one off successes [imac, iPod, iPhone, Macbook Air, iPad, ...] and so are waiting for the bust, manufacturing/hardware can't be this successful for this long [its a freak of nature], it violates all the MBA training [Clay Christensen'c view all successful companies are doomed because of MBA training], ....?

Is Apple's model learnable and can it be duplicated by others across a wide range of products and industries?  Doubtful, but does anybody understand it to teach it?

Great post. What Apple is doing doesn't even have a name yet much less a rationale. You can't teach what you don't understand.
post #14 of 113
Quote:
Originally Posted by umrk_lab View Post

(...)at this point, the French people, who always like to complain, argue that this is unfair, because 99 Euros cents are a lot more than 99 US $ cents.

You leave the French out of this! (insert a smiley here; I don't use them)

I'm Dutch, and complain that they charge € 2279 for a MBPr which does ≉ to $ 2199. It's actually € 1814, but there's the (State/Value Added) Tax thing to consider, but I digress.
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post #15 of 113

Just curious. Are there private companies who make more profit than Apple?
 

post #16 of 113
Quote:
Originally Posted by melgross View Post



Then there is what seems to be the age old question of an actual Tv of some kind. Estimates are that if Apple gets just 2% of the Tv market, that could be $11 billion that year for them. If their sets cost the $2,000 average predicted, it could be more than 2%, as $2,000 is just the average price for a large screen advanced model, which go over $4,000.

Actually, Apple, could potentially market the "Apple TV" any one or more of three different ways.  1.  They can continue to put out more Apple TV boxes like they have for the entry level market.  2.  If they made a more powerful motherboard, they could market it as an OEM - Co-marketed product with any HDTV mfg to integrate the board with a built-in video camera and the HDTV company makes the final product and they co-market it. Apple could generate additional revenue by selling apps/content through their App Store and iTunes Music store which gets streamed or stored in SSD memory inside the TV.  3.  Design and build the entire TV set using a OEM panel.   The first is already building in market share.  The second method could be marketed using any or all of the various screen technologies by different companies under various names that want to leverage Apple's strength in the iPad/iPhone market as those devices are easily connected and can be used as a remote control, or simply using a Mac/keyboard/trackpad.  The Pros are wider almost immediate revenue generation as they can sign up a variety of mfg that already have brand recognition as well as going after the three price categories (low, med, high).  currently, HDTVs go from the $300 small panel 720p screens on up to the $100K+ 100inch 1080p or the next generation 4K panels which are being shown. Yes, Apple will generate revenue, albeit less than if they made their HDTV, but probably a little more than the entry level system.  And the third method by designing and mfg their own HDTV, it would generate more revenue/profits providing it is in the category that sells to the sweet spot of the market, but the biggest challenge is what type of panel to use and generating enough brand recognition as a HDTV mfg.  The problem is that while Plasma is still considered the best picture quality, it is fragile and more costly.  LCD is less costly and more widely sold, it is still not as good as a plasma in picture quality.  OLED is still new, expensive and they have their own set of problems to overcome due to organic materials which decay over time thus effecting the long term quality.  EIther way, between the various mfg, obtaining the right screen technology and remaining competitive may prove to be difficult.  Apple can do all three or any combination.  It all depends on how serious and how much they invest in the market to grab a significant portion of the market potential.

post #17 of 113
Quote:
"Microsoft held over 90% market share for PC operating systems at the peak cap, while Cisco had over 70% share in the networking market and Intel had over 80% of the PC processor market," White said. "By comparison, IDC estimates that Apple held just 4.7% of the PC market in (the first quarter of 2012) and 8.8% share in the mobile phone market."

 

This is just fucking amazing. 

post #18 of 113

It would be interesting to put this is in better historical context by adjusting these numbers for inflation.

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post #19 of 113
Quote:
Originally Posted by macarena View Post

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

 

 

 

I disagree. A Mac Mini is pretty damn cheap and anybody who can't afford a Mac has zero business developing any software for Apple.

 

I don't want bums and homeless people to be making iOS apps. Let them stick to Android software. 

post #20 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare?

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

Even if Apple lowers margins on Macs to 10%, it will not hurt their bottom line in a significant way. And in all likelihood, the resulting increase in sales will more than make up for the lower margins.

I argue that immediately following product refresh of a product line of the Mac product family that Apple Mac is the best value.

Reducing margins to reduce cost would potentially damage the aspirational branding of Apple products. Despite a aspirational, luxury brand pricing strategy the Apple MacBook Air is highly competitive on a price basis with competitors. The only area where the Apple Mac product family is not competitive is netbooks because their strategy for the netbook market is the iPad.
Quote:
Originally Posted by melgross View Post

With the agreement with at least 9 major auto makers to put a Siri button on the steering wheel (a major, and shocking development according to friends in the auto business), Apple is getting in front of that business. How far it will go is anyone's guess right now, but we can be sure that Apple has plans for this that go further than it may now seem.

Why is this a shocking development?
post #21 of 113
Quote:
Originally Posted by IQatEdo View Post

So, 'the barrier to developing iPhone and iPad software is significantly higher than the barrier to developing Android software'.  Does this mean that developers are leaving iOS for Android?  

 

 

 

There are too many additional factors to be able to come to any firm conclusions based solely upon this info.

post #22 of 113
Quote:
Originally Posted by SolipsismX View Post

I think it'll be the same people that will claim "Steve would have never done this" for anything Apple does…

"Steve would have never created record profits."
Quote:
Originally Posted by jj.yuan View Post

Just curious. Are there private companies who make more profit than Apple?

I'd imagine. The royal Saudi oil company comes to mind… I think I remember reading that if it was public it'd have a three trillion dollar market cap or something, and profits are obviously quite high.

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post #23 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare? [...]

 

Because they don't have to.  Apple is gradually bringing their retail pricing down while maintaining their high margins.  For example, the original MacBook Air began life as an $1800 "executive laptop."  Now, the 11" model starts at $1000 and the 13" model starts at $1200.

 

And Apple can maintain their high margins because they get the best deals on many of their components.  For example, Apple is the world's leading consumer of NAND memory.  78% of the world's NAND memory production went into iPads last year according to Computerworld.  And all MacBook Air models (and the new Retina MacBook Pro) use NAND-based SSDs instead of HDDs now.  Everyone else is forced to out-bid each other for the remaining supply.  And Apple is working hard to lower other component costs while maintaining or improving quality.  The recent Foxconn-Sharp IGZO LCD screen deal is an example.

 

In case you hadn't noticed, Apple just dropped the price of the three higher-end MacBook Air models by $100.  You better believe that the Ultrabook makers of the world noticed.

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post #24 of 113

"Apple's 2012 profits forecast to be highest of any public company ever"

 

And the lowest in charitable giving - ever...

 
 
post #25 of 113
Quote:
Originally Posted by Flaneur View Post

Before someone else says it, Apple did not invent the tablet category. What they did invent was the first usable, attractive tablet.
This category that they did invent will grow to take over most of the PC industry, because it's what more people need in more places. It will take over the book and magazine industry as well, maybe also news and TV. Huge growth lies ahead.
The phone category is really the pocket computer category, or better, the pocket communication and knowledge terminal. Everyone in the world is the market for these.
The next category is wearable. Eyeglass screens, eyeglass cameras, etc.
Old concepts of growth limits do not apply to a company that is behind a new industrial revolution. Actually a new postindustrial revolution that doesn't even have a name yet, as far as I know. The Tofflers' Third Wave doesn't capture what we're dealing with. It's unprecedented, so new horizons in thought are called for.
Edit: I see Mel Gross tossing out 500 million a year for tablets. I don't know about that kind of number, but that's the kind of talk we ought to be seeing. The future is huge.
Edit 2: At this point, we can say that Apple shows the computer industry to really be the communications, knowledge and arts/entertainment industry. It has been doing this from the garage days, still doing it, humanizing the Turing machine. Other companies give this humanizing only lip service, while they're bound by engineering, not art or even much design.

Estimates for tablet sales in 2016 for 375 million units have already been made by a couple of the companies doing that sort of thing.

Apple's Newton was the first true tablet. In fact, it was Apple who convinced Acorn to establish a mobile division for their CPU, which Apple shared, thus taking a large part in inventing the mobile ARM chip.

One could say that Apple made the most contributions over the years to tablet computing, and to cell phone development as well, because of this.
post #26 of 113
Quote:
Originally Posted by gprovida

Is Apple's model learnable and can it be duplicated by others across a wide range of products and industries? Doubtful, but does anybody understand it to teach it?
Quote:
Originally Posted by Flaneur

Great post. What Apple is doing doesn't even have a name yet much less a rationale. You can't teach what you don't understand.

It's called the Macintosh Way as articulated by former Apple evangelist Guy Kowasaki in his book of the same name, circa 1987 or so.

The Macintosh Way is to simply "do the right thing the right way."

Quote:
But White believes Apple's market cap potential in trillions of dollars, not billions.

The Macintosh Way is the secret sauce of everything Apple does. IMHO, this book is a must read for the serious Apple investor,
Edited by King of Beige - 6/18/12 at 10:19am
post #27 of 113
Quote:
Originally Posted by jj.yuan View Post

Just curious. Are there private companies who make more profit than Apple?

In 2011 there were still public companies that made more profit than Apple. Both oil companies. That's likely not going to be the case in 2012.


As for private companies it's hard to tell what they make or what their value is but I think there are some that are far beyond any public company at this point. They, too, are also most likely in the oil business. One of most prominent is Saudi Aramco.

I think the $7 trillion value is probably excessively inflated but I would say it's probably far beyond what Apple currently has. Without being able to multiply a stock value to the number of stocks it's simply impossible to determine a valuation and since they don't have shareholders to deal with there is much less oversight.
Edited by SolipsismX - 6/18/12 at 10:43am

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post #28 of 113
Quote:
Originally Posted by umrk_lab View Post

Spring 2015 : Tim announces that from now on, the Apple enormous cash resulting from recurrent revenues driven from immaterial content (advertising, music, films, press ..) enable the company to distribute its electronic consumer products at 99 cents unique price (at this point, the French people, who always like to complain, argue that this is unfair, because 99 Euros cents are a lot more than 99 US $ cents.

 

At this point, analysts just give up : recognizing that they will never understand Apple business, except that it is exceptionnaly profitable, they simply strongly advise to buy Apple shares at any price.

 

Apple could have 1/5 of its market cap in cash, strong growth, high potential growth, an incredibly low P/E compared to other companies, and... Oh wait, it already has that!

 

Based on what actually happens, they'd recommend dumping Apple shares at that point and push Facebook instead. Get used to it, the analysts want to look smart by being ahead of the curve when Apple does falter eventually, so they instead keep looking stupid quarter after quarter now. In the analyst world, this somehow makes sense and doesn't get them fired. (Most likely because they're being rewarded for manipulating the markets for the trading arms of their banks, but now I sound cynical.)

post #29 of 113
Quote:
Originally Posted by melgross View Post


Estimates for tablet sales in 2016 for 375 million units have already been made by a couple of the companies doing that sort of thing.
Apple's Newton was the first true tablet. In fact, it was Apple who convinced Acorn to establish a mobile division for their CPU, which Apple shared, thus taking a large part in inventing the mobile ARM chip.
One could say that Apple made the most contributions over the years to tablet computing, and to cell phone development as well, because of this.

 

Don't you mean that Newton was the first true tablet from Apple? Weren't there others predating Newton that were equally (dys)functional? :)

post #30 of 113
Quote:
Originally Posted by MJ1970 View Post

It would be interesting to put this is in better historical context by adjusting these numbers for inflation.

I wondered the same thing - were they adjusted? If not, then there's probably no reason to think there's anything lower than a $2 trillion barrier. Not that it's a true barrier either way.

post #31 of 113
Quote:
Originally Posted by Flaneur View Post


Great post. What Apple is doing doesn't even have a name yet much less a rationale. You can't teach what you don't understand.

 

I suggest that what Apple is doing is "planned disruption" to existing products and solutions -- including their own.

 
This week marks the first anniversary of the release of FCP X.  Apple had the chutzpah to disrupt thousands of satisfied (to the extent possible) of their own FCP 7 installations.
 
By some accounts, Apple has sold millions of FCP X apps at $300 -- as opposed to tens of thousands of FCP 7 apps at $1,000.
 
 
More importantly, FCP X establishes a base for growth of video editing for the next decade, or longer.  And, realistically, opens video editing to the evolving mobile platforms.
 
 
This ad for the Retina MacBook Pro shows FCP X running a full 1080P video in the upper right corner of 1 15" display.
 
 
 
This is where the puck is going -- and it is not possible on any other Video Editor on any other platform!
 
 
Further, the price of entry to FCP X video editing on a Retina MacBook Pro is $2,500 - $4,100 -- tens of thousands of $ less than other systems.

 "planned disruption" to existing products and solutions -- including their own.

 
This week marks the first anniversary of the release of FCP X.  Apple had the chutzpah to disrupt tens of thousands of satisfied (to the extent possible) of their own FCP 7 installations.
 
By some accounts, Apple has sold millions of FCP X apps at $300 -- as opposed to tens of thousands of FCP 7 apps at $1,000.
 
 
More importantly, FCP X establishes a base for growth of video editing for the next decade, or longer.  And realistically opens video editing to the evolving mobile platforms.
 
 
This ad for the Retina MacBook Pro shows FCP X running a full 1080P video in the upper right corner of 1 15" display.
 
 
 
This is where the puck is going -- and it is not possible on any other Video Editor on any other platform!
 
 
Further, the price of entry to FCP X video editing on a Retina MacBook Pro is $2,500 - $4,100 -- tens of thousands $ less than other systems.
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"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
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post #32 of 113
Quote:
Originally Posted by MacBook Pro View Post

I argue that immediately following product refresh of a product line of the Mac product family that Apple Mac is the best value.
Reducing margins to reduce cost would potentially damage the aspirational branding of Apple products. Despite a aspirational, luxury brand pricing strategy the Apple MacBook Air is highly competitive on a price basis with competitors. The only area where the Apple Mac product family is not competitive is netbooks because their strategy for the netbook market is the iPad.
Why is this a shocking development?
Because these companies consider their vehicle to be very proprietary. They have standard interfaces for entertainment systems, and they have been willing to provide a socket in those systems for an iPod. But to give a place on the steering wheel to a third party is unheard of. It also directly competes with their highly profitable
GPS upgrades.
post #33 of 113
Quote:
Originally Posted by ankleskater View Post

Don't you mean that Newton was the first true tablet from Apple? Weren't there others predating Newton that were equally (dys)functional? 1smile.gif

The first true tablet. Period.

I still have mine. It wasn't dysfunctional. In the beginning the handwriting was not great. But it got much better. It was actually selling well when Jobs discontinued it.
post #34 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare?

 

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

 

Even if Apple lowers margins on Macs to 10%, it will not hurt their bottom line in a significant way. And in all likelihood, the resulting increase in sales will more than make up for the lower margins.

 

Apple is attacking the PC market from both ends.

Macs on the high end and iPads on the low end.

 

You can buy a used Mac mini for $200-300 and develop for iOS.

post #35 of 113
Quote:
Originally Posted by gprovida View Post

Is Apple's model learnable and can it be duplicated by others across a wide range of products and industries?  Doubtful, but does anybody understand it to teach it?

Yes, and the class is free.  http://5by5.tv/criticalpath/

post #36 of 113
Quote:
Originally Posted by melgross View Post


Because these companies consider their vehicle to be very proprietary. They have standard interfaces for entertainment systems, and they have been willing to provide a socket in those systems for an iPod. But to give a place on the steering wheel to a third party is unheard of. <...>
 

 

 

I remember, many years ago, hearing automotive executives say that they did not want, in any case "let Bill Gates come under the bonnet/hood (?)" . Now they probably think it is innocent to let Apple be on the steering wheel ... 

post #37 of 113
Quote:
Originally Posted by Flaneur View Post


Great post. What Apple is doing doesn't even have a name yet much less a rationale. You can't teach what you don't understand.

 

I suggest that what Apple is doing is "planned disruption" to existing products and solutions -- including their own.

 
This week marks the first anniversary of the release of FCP X.  Apple had the chutzpah to disrupt tens of thousands of satisfied (to the extent possible) of their own FCP 7 installations.
 
By some accounts, Apple has sold millions of FCP X apps at $300 -- as opposed to tens of thousands of FCP 7 apps at $1,000.
 
 
More importantly, FCP X establishes a base for growth of video editing for the next decade, or longer.  And realistically opens video editing to the evolving mobile platforms.
 
 
This ad for the Retina MacBook Pro shows FCP X running a full 1080P video in the upper right corner of a 15" display.
 
 
 
This is where the puck is going -- and it is not possible on any other Video Editor on any other platform!
 
 
Further, the price of entry to FCP X video editing on a Retina MacBook Pro is $2,500 - $4,100 -- tens of thousands $ less than other systems.
 
This week marks the first anniversary of the release of FCP X.  Apple had the chutzpah to disrupt tens of thousands of satisfied (to the extent possible) of their own FCP 7 installations.
 
By some accounts, Apple has sold millions of FCP X apps at $300 -- as opposed to tens of thousands of FCP 7 apps at $1,000.
 
 
More importantly, FCP X establishes a base for growth of video editing for the next decade, or longer.  And realistically opens video editing to the evolving mobile platforms.
 
 
This ad for the Retina MacBook Pro shows FCP X running a full 1080P video in the upper right corner of 1 15" display.
 
 
 
This is where the puck is going -- and it is not possible on any other Video Editor on any other platform!
 
 
Further, the price of entry to FCP X video editing on a Retina MacBook Pro is $2,500 - $4,100 -- tens of thousands $ less than other systems.
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
"Swift generally gets you to the right way much quicker." - auxio -

"The perfect [birth]day -- A little playtime, a good poop, and a long nap." - Tomato Greeting Cards -
Reply
post #38 of 113

Apple poised to post highest profit and revenue ever thanks to the perfect storm. As we see Apple has just released new hardware with more to follow, the New Ihone 5 coming  this fall, a possible new TV or Ipanel, new operating systems for mobile and land............lets face it, it doesn't get any better than this. (I forgot to mention Apples upcoming deal with China Mobile)

My question is what does Apple do for an encore.

post #39 of 113
Quote:
Originally Posted by macarena View Post

Considering how small Computers have become, as a percentage of Apple's Revenue and Profits, it is indeed strange that Apple still insists on high margins in this space. In Apple's own reckoning, the PC market is a dying market, and the future is in tablets. Then why don't they lower their margins and make a play for increased marketshare?

 

Today, the barrier to developing iPhone and iPad software is significantly higher than the barrier to develop Android Software. You absolutely need a Mac to build iOS software. And with Apple's prices, this is a stiff entry barrier indeed.

 

Even if Apple lowers margins on Macs to 10%, it will not hurt their bottom line in a significant way. And in all likelihood, the resulting increase in sales will more than make up for the lower margins.

PC's are a dying market????  Where on earth did this come from.   Trucks vs cars, yes... Dying???  no.

 

Yes Apple computers cost less than the cheapest pc stuff.... So what.  A great car cost more than an econo box. Your point is???  

 

What is this relentless push for market share??  Lets lose money so we can have bragging rights.    I see how well market share has done for HP and DELL.  Yep, they are doing great today.   Buy your Dell yet??

 

I have a six year old iBook that is still running great.   Apple products just work better and longer.   Just a thought.

post #40 of 113
Quote:
Originally Posted by LuxoM3 View Post

"Apple's 2012 profits forecast to be highest of any public company ever"

And the lowest in charitable giving - ever...



 


 




Giving away losts of money to charity is mostly a sign that the money isn't earned in an honest way; a way to buy back your soul so to say.
Now if it is done anonymously it could be another matter entirely.
It is indicated several times in the recent past that Apple does donate a lot of money, they just don't brag about it. But you seem to have proof that Apple doesn't do that?

J.
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