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Apple profits up nearly 25% on sales of 26.9M iPhones, 14M iPads, and 4.9M Macs - Page 2

post #41 of 82
Quote:
Originally Posted by Rogifan View Post

Peter Oppenheimer asked about the pricing of iPad mini and says the mini margins are significantly lower than the rest of their product line. Why is that? Wasn't the thought that they priced it at $329 to keep their higher margins?

it isn't made of plastic.

it has a decent, useful for work and stable OS that everyone (consumers, enterprise) sees as the best mobile OS out there.

 

Huge ecosystem that takes money to keep growing.

Efficient components.

 

etc.

 

Compare this to the nexus 7 (that has 0 profit)

post #42 of 82
Quote:
Originally Posted by Harbinger View Post


Goes to show how pundits are often wrong. There are two things that might be cheaper on the iPad Mini than on the iPad - the display and the case. Otherwise, the internals are highly similar. In facg, 1024 x 768 at 7.9" may well be more expensive than 1024 x 768 at 9.7". The difference in cost of the aluminum back is tiny. Therefore, the cost of making iPad Mini may be in fact the same as or higher than iPad 2. But they are forced to sell it at a lower price due to expectations that a smaller tablet should be cheaper.
But couldn't the case be a bit more expensive (at least initially) if its a different manufacturing process? Oppenheimer kept referring to higher manufacturing costs that they're working to bring down.
post #43 of 82
Quote:
Originally Posted by pedromartins View Post

it isn't made of plastic.
it has a decent, useful for work and stable OS that everyone (consumers, enterprise) sees as the best mobile OS out there.

Huge ecosystem that takes money to keep growing.
Efficient components.

etc.

Compare this to the nexus 7 (that has 0 profit)
I'm not talking about the comparison to competitors tablet products. I'm questioning why, at $329 are the margins significantly lower? I think many assumed the higher price than expected was to keep the high margins. According to Oppenheimer that isn't the case.
post #44 of 82
I must say that I really don't understand how financial markets tick - AAPL profit goes up in an apparently recessed/depressed economy, so their share price goes down. What would make the market happy - a total economic depression/collapse? What am I missing here?
post #45 of 82
Quote:
Originally Posted by AlexN View Post

I must say that I really don't understand how financial markets tick - AAPL profit goes up in an apparently recessed/depressed economy, so their share price goes down. What would make the market happy - a total economic depression/collapse? What am I missing here?


You are missing how much Apple stock price has gone up for the quarter and for the year. Some people are just upset because the stock doesn't go up everyday.

post #46 of 82
Only thing screwed up was Apple doing business with Samsung.. who do you think those screen delays came from.. you think that's by accident..Don't think so...

Apple is cutting ties with Samsung for a reason.. and delayed displays and parts is the exact reason for it..
post #47 of 82
Quote:
Originally Posted by jecaron View Post

Only thing screwed up was Apple doing business with Samsung.. who do you think those screen delays came from.. you think that's by accident..Don't think so...
Apple is cutting ties with Samsung for a reason.. and delayed displays and parts is the exact reason for it..


Assuming Samsung makes money doing business with Apple, the delayed displays and parts would be costing them.

post #48 of 82
Quote:
Originally Posted by pt123 View Post

Quote:
Originally Posted by AlexN View Post

I must say that I really don't understand how financial markets tick - AAPL profit goes up in an apparently recessed/depressed economy, so their share price goes down. What would make the market happy - a total economic depression/collapse? What am I missing here?


You are missing how much Apple stock price has gone up for the quarter and for the year. Some people are just upset because the stock doesn't go up everyday.

My view of such things has up till now been very superficial: it looks as though I need to put some effort into researching and understanding the system!
post #49 of 82

If you're disappointed with Apple, one can only imagine the let-down you're feeling with Google and MS. Those two turkeys are just abysmal compared to Apple's performance. 

post #50 of 82
Quote:
Originally Posted by Quadra 610 View Post

If you're disappointed with Apple, one can only imagine the let-down you're feeling with Google and MS. Those two turkeys are just abysmal compared to Apple's performance. 

Even stranger then that GOOG's share price is higher than APPL's. I'm off to do some digging 1smile.gif.
post #51 of 82

I told you we would hit sub 600 after Zacky's report ;)

post #52 of 82
Quote:
Originally Posted by AlexN View Post


Even stranger then that GOOG's share price is higher than APPL's. I'm off to do some digging 1smile.gif.

 

You can't compare share prices like that. There's no relevance whatsoever.

post #53 of 82
Quote:
Originally Posted by AlexN View Post


Even stranger then that GOOG's share price is higher than APPL's. I'm off to do some digging 1smile.gif.

What are you talking about? GOOG has less than half of the number of shares that apple has.

post #54 of 82
Quote:
Originally Posted by AlexN View Post


My view of such things has up till now been very superficial: it looks as though I need to put some effort into researching and understanding the system!


I don't want to sound arrogant, but my recommendation to you is: do NOT try to place rhyme/reason on each major short term move of AAPL stock.  Some of us have been following intently on both technical analysis and macro events, but any confidence we've gained is easily used against us.  Instead, invest the majority for the long-term and use a bit of play money to ride some of the swells mid-term (as in a handful of trades/year).  Trading large blocks in the short term is for pros and/or the pure gamblers.  Now is a good time to buy....then ride it (with its ups downs) for at least a year.  Good luck.

post #55 of 82
It does seem that Apple, considering how big it has gotten over the past several years, is no longer immune to the global macro economic conditions that have dogged other companies. The results are still outstanding by any measure, but it does seem that the days of year-over-year 70% revenue and 100%+ earnings growth are over.
 
Apple's business is now much more complex than it was only a few years ago when you consider the iCloud and other services-oriented initiatives to tie in with growing hardware offerings. Perhaps the tablet market isn't going to grow quite as fast as what everyone has been predicting. Perhaps the later-than-expected rollouts of the new Macs have also affected the top and bottom lines.
 
Competitive pressures also seem to have affected the margins as well. I don't think we can expect Apple to post net margins of 28~29% again as it did in the 1st and 2nd quarters of fiscal 2012. The guidance for the next quarter also indicates net margin in the 22~23% range, which is still amazingly impressive for a hardware company but not in the surreal realms of nearly 30%.
 
Growth rate has also slowed noticeably but that's more than understandable in this rotten global economy - especially in Europe and with the slowdown in China. The "haves" around the world will continue to buy new Apple gear over and over again but what about the "have-nots" or just common folks like me who don't really *need* to upgrade every two years when the stuff works just fine?
 
Things actually do look more challenging for Apple than it has over the past 5 years. Apple is at the top with a big bullseye mark attached to it by every competitor in the world. The competitors were blindsided by the iPhone and the iPad but it's unlikely that such a paradigm-shifting new product will come out anytime soon as the smartphone and tablet products mature over the next several years.
 
Still, moving forward, Apple remains better positioned than any other tech company out there when you observe the likes of Google, Microsoft, Samsung, HP, Dell, Sony, Nokia, RIM, etc. Apple provides differentiated and tightly integrated products, services and an experience that no one else can even come close to matching. As Tim Cook said, it's the long haul that matters when the competitors are scrambling to keep up, stem the losses, or just outright survive.
post #56 of 82
Quote:
Originally Posted by alexkhan2000 View Post

[...] The "haves" around the world will continue to buy new Apple gear over and over again but what about the "have-nots" or just common folks like me who don't really *need* to upgrade every two years when the stuff works just fine?

 

 

Maybe, just maybe, what the "Pro" creative community have been threatening is actually happening. As Apple increasingly puts the Ive before the horse in an apparent trend to form over function, perhaps others like me have just said, "Screw it, I'm not buying this..."

 

My standard replacement cycle called for a new MBP this year, but then they axed the 17". I really extra super don't want to go smaller (I'd buy bigger if I could) so now I'm not sure what to do -- wait and hope Apple brings it back or give up OSX and buy Asus? I also really want USB3 on the Mini in the living room so I was going to jump the refresh cycle on that, but they now refuse to provide reasonable graphics or drive options, so again I'm stalled.

 

That's only two machines (three if you count maybe updating my wife's machine to get AirPlay video mirroring) but if there are enough others like me I suppose it might slow growth.

post #57 of 82
Quote:
Originally Posted by Rogifan View Post


But couldn't the case be a bit more expensive (at least initially) if its a different manufacturing process? Oppenheimer kept referring to higher manufacturing costs that they're working to bring down.


It does not have to be more expensive than iPad2 to make for the margin to be lower. Assume the manufacturing cost of iPad Mini to be $20 lower and the margin will still be lower than what you get for iPad2, not to mention iPad3/4.

post #58 of 82
Quote:
Originally Posted by v5v View Post

 

 

Maybe, just maybe, what the "Pro" creative community have been threatening is actually happening. As Apple increasingly puts the Ive before the horse in an apparent trend to form over function, perhaps others like me have just said, "Screw it, I'm not buying this..."

 

My standard replacement cycle called for a new MBP this year, but then they axed the 17". I really extra super don't want to go smaller (I'd buy bigger if I could) so now I'm not sure what to do -- wait and hope Apple brings it back or give up OSX and buy Asus? I also really want USB3 on the Mini in the living room so I was going to jump the refresh cycle on that, but they now refuse to provide reasonable graphics or drive options, so again I'm stalled.

 

That's only two machines (three if you count maybe updating my wife's machine to get AirPlay video mirroring) but if there are enough others like me I suppose it might slow growth.

 

I'm not a "Pro" by any means. I'm just your average small business and family guy so all the goods that Apple provides now are more than enough. But I can certainly understand the plights of the long-time loyal pro users who feel neglected by Apple. I'm in the musical instruments and equipment industry and work with serious pro musicians and video artists who feel like they're being abandoned in favor of the everyday people just trying to get through the day with their chores.

 

As a long-time (20+ years) Apple user, fan-observer and very small shareholder, I'd like to think that Apple cares about the cutting-edge technology and products necessary to maintain the "mind share" even if such products don't really add anything significant to their overall business - the Mac Pro being the obvious example and the 17" MBP you bring up. I guess we'll know for sure within the next year if Apple is at all committed to the pro markets on the Mac/PC side of things.

post #59 of 82
Quote:
Originally Posted by John Nugent View Post

So CNBC just called the numbers "disappointing" -- after beating all but the outlier-est estimates? Sheesh.

 

How is the stock buyback going with Apple anyway? These hits to the stock seem like opportune times for Apple to bring a few million shares back into the fold.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

Reply
post #60 of 82
Quote:
Originally Posted by alexkhan2000 View Post

It does seem that Apple, considering how big it has gotten over the past several years, is no longer immune to the global macro economic conditions that have dogged other companies. The results are still outstanding by any measure, but it does seem that the days of year-over-year 70% revenue and 100%+ earnings growth are over.
 
Apple's business is now much more complex than it was only a few years ago when you consider the iCloud and other services-oriented initiatives to tie in with growing hardware offerings. Perhaps the tablet market isn't going to grow quite as fast as what everyone has been predicting. Perhaps the later-than-expected rollouts of the new Macs have also affected the top and bottom lines.
 
Competitive pressures also seem to have affected the margins as well. I don't think we can expect Apple to post net margins of 28~29% again as it did in the 1st and 2nd quarters of fiscal 2012. The guidance for the next quarter also indicates net margin in the 22~23% range, which is still amazingly impressive for a hardware company but not in the surreal realms of nearly 30%.
 
Growth rate has also slowed noticeably but that's more than understandable in this rotten global economy - especially in Europe and with the slowdown in China. The "haves" around the world will continue to buy new Apple gear over and over again but what about the "have-nots" or just common folks like me who don't really *need* to upgrade every two years when the stuff works just fine?
 
Things actually do look more challenging for Apple than it has over the past 5 years. Apple is at the top with a big bullseye mark attached to it by every competitor in the world. The competitors were blindsided by the iPhone and the iPad but it's unlikely that such a paradigm-shifting new product will come out anytime soon as the smartphone and tablet products mature over the next several years.
 
Still, moving forward, Apple remains better positioned than any other tech company out there when you observe the likes of Google, Microsoft, Samsung, HP, Dell, Sony, Nokia, RIM, etc. Apple provides differentiated and tightly integrated products, services and an experience that no one else can even come close to matching. As Tim Cook said, it's the long haul that matters when the competitors are scrambling to keep up, stem the losses, or just outright survive.

 

Nonsense. October is typically a down market month and this one is no exception. Added to this is the fact that we're about to see the president re-elected, which will harm markets further.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #61 of 82
Quote:
Originally Posted by igriv View Post

 

 
They mentioned a buyback on the conference call.
 

 

Anything of interest? I missed the call.

Proud AAPL stock owner.

 

GOA

Reply

Proud AAPL stock owner.

 

GOA

Reply
post #62 of 82
Quote:
Originally Posted by SpamSandwich View Post

 

Nonsense. October is typically a down market month and this one is no exception. Added to this is the fact that we're about to see the president re-elected, which will harm markets further.

 

That's silly. The markets were doing pretty well until after the Denver debate, when you-know-who surged in the polls. Dow and S+P down 3.5% since, NASDAQ down 5%. Shouldn't they be celebrating?

post #63 of 82

Agree that the analysts are brain-dead on this one. It's like they had written their stories beforehand. Revenue actually beat average expectations a bit, and profit was minimally below. Most are calling the forward guidance a "warning", although last year, Apple's guidance for the Christmas quarter was $9.30 in profit on $37B revenue. They blew that out. This year they're guiding to $11.75 (26% above last year's guidance) on $52B (40% over last year's). 

 

That's a "warning?" Seriously?

A few reporters actually noticed that if Apple can pull off what it's projecting next quarter, it will be the largest quarterly revenue ever reported for a tech company.

And BTW, after hours, AAPL finished up, not down.

post #64 of 82
Quote:
Originally Posted by pdq2 View Post

A few reporters actually noticed that if Apple can pull off what it's projecting next quarter, it will be the largest quarterly revenue ever reported for a tech company.

 

 

Actually, I guess they'd be breaking their own record.

post #65 of 82
Quote:
Originally Posted by pdq2 View Post

Agree that the analysts are brain-dead on this one. It's like they had written their stories beforehand. Revenue actually beat average expectations a bit, and profit was minimally below. Most are calling the forward guidance a "warning", although last year, Apple's guidance for the Christmas quarter was $9.30 in profit on $37B revenue. They blew that out. This year they're guiding to $11.75 (26% above last year's guidance) on $52B (40% over last year's). 

 

That's a "warning?" Seriously?

A few reporters actually noticed that if Apple can pull off what it's projecting next quarter, it will be the largest quarterly revenue ever reported for a tech company.

And BTW, after hours, AAPL finished up, not down.

 

Quote:
Originally Posted by pdq2 View Post

 

 

Actually, I guess they'd be breaking their own record.

 

Yet, analysts are calling for numbers greater than Apple's own recording breaking projections. Their modus operandi is clear - look at a company's history to see how conservative it is and then multiply its projections by an appropriate factor to create their own estimates. Then pocket a few 100ks.

post #66 of 82
Quote:
Originally Posted by pdq2 View Post

 

And BTW, after hours, AAPL finished up, not down.

 

AAPL will be ok, but I don't expect AAPL to outperform the market anytime soon. With iPad 4th gen, Apple has to write down A LOT of iPad 3rd gen (they're selling them for $379 refurb right now), so it's definitely going to hurt AAPL's margin on iPad, plus with iPad mini, a lot of people will get the mini instead for their kids (iPad too heavy for children, plus mini is cheaper), which will hurt the margin further. 

post #67 of 82
Quote:
Originally Posted by SpamSandwich View Post

 

Nonsense. October is typically a down market month and this one is no exception. Added to this is the fact that we're about to see the president re-elected, which will harm markets further.

Really??   Because a few days before Obama took office, the Dow was at 8776 and today, even with big declines this week, it's at 13,103.     So I think Wall Street cries "wolf" when they talk about Obama.   They just hate him because they think he's going to tax their riches slightly more - back to Clinton levels. 

post #68 of 82
Quote:
Originally Posted by zoetmb View Post

Really??   Because a few days before Obama took office, the Dow was at 8776 and today, even with big declines this week, it's at 13,103.     So I think Wall Street cries "wolf" when they talk about Obama.   They just hate him because they think he's going to tax their riches slightly more - back to Clinton levels. 

 

Contrary to popular belief, the [stock market] has done better more times with Democrats than it has with Republicans.

na na na na na...
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na na na na na...
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post #69 of 82
Isn't all that cash bad news for the upcoming tax increase?
post #70 of 82
Quote:
Originally Posted by igriv View Post

 

 
You are not wrong, but not 100% right. If GOOG did a 10:1 split, the market cap would probably go up by 10% (since more retail people would by the stock). Same for Apple. The interesting question is why they don't (I believe the reason is pride).
 

 

It would barely make a difference. The number of shares sold to people who can't afford them would hardly register on the radar if they did a stock split. Retail investors only make up about 10% of AAPL ownership (last I looked at the numbers), and many of these retail investors are owning more than 1 share. So in reality I think it's fair to say Apple would barely go up by a fraction of a percent. This is the reason why they haven't, nothing to do with pride.

post #71 of 82
Quote:
Originally Posted by Rogifan View Post

Peter Oppenheimer asked about the pricing of iPad mini and says the mini margins are significantly lower than the rest of their product line. Why is that? Wasn't the thought that they priced it at $329 to keep their higher margins?

Translation: "Didn't I and another blowhard agree here that Apple is trying to rip us off?
Edited by Flaneur - 10/26/12 at 1:59am
post #72 of 82
Apple missed the second time analyst expectations. I warned a few months ago that Apple is entering the troubling times. While analysts are busy updating their spreadsheets, they miss the big picture, they keep chasing the trend, they keep simply extrapolating the iPhone, iPad, and Mac sales numbers but fail to grasp the two principles that have been determining the phenomenal rise of Apple and will shape its eventual fall.

The two principles allowed me in 2005 predict the Apple led revolution and Apple stock multiplying to astronomical at that time price of $300 (as many Apple Finance Board members might recall). This was at the time when the most bullish Apple analyst, Gene Munster, was predicting just $60 price for AAPL.

Now analysts tout $1000 or even $1400 price for AAPL but the two principles say that AAPL is heading back to $300. We, of course, will see higher values along the way... but trouble and forced lower margins are ahead for AAPL.
post #73 of 82

Agree, the numbers were better than expected. How do these people keep their jobs??

post #74 of 82

I'm sure they did their math on this scenario

post #75 of 82
Quote:
Originally Posted by igriv View Post

 
I actually don't see why the Mini is cheaper to make than the iPad 2 at all, and the iPad 2 is a mature product (= money machine). Just wait a quarter, and the Mini margins will be back at the same level.
 
So really then the mini isn't overpriced, unless one thinks Apple should have even smaller margins. I'll admit I was hoping for $299 But I guess making something smaller doesn't mean it's cheaper to make.
post #76 of 82
Thanks to those who replied directly to my query about the AAPL stock dip(?). I'm doing a bit of brushing up of my rusty economics (which wasn't much and was years ago) and also feretting around for what else I can learn from (starting with the Wikipedia, because it's the most accessible for me currently 1wink.gif).

Cheers,
Alex.
post #77 of 82
Quote:
Originally Posted by Harbinger View Post


Let's see - Mac sales held steady y/y (best ever September quarter sales), when most PC companies lost sales. They are entering Christmas season with new 13" rMBP, new iMac that is paper thin at the edge and relatively new 15" rMBP. How exactly did they drop the ball? Can you explain a better way of timing their releases?

 

Yes, the Mac sales hang steady. They would have done far more than hold steady if they'd not cocked up the desktop refresh. The reason they only held steady is that the large increase in notebook turnover was nerfed by the huge slump in desktop sales.

iPad, Macbook Pro, iPhone, heck I even have iLife! :-)
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iPad, Macbook Pro, iPhone, heck I even have iLife! :-)
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post #78 of 82
Quote:
Originally Posted by SolipsismX View Post

APPL is projecting more revenue for next quarter than GOOG has generated for the last 4 quarters combined.

APPL = APPELL PETE CORP
AAPL = Apple Inc.

A typo, I'm sure of that. But perhaps not known by some (although all other posts in this thread are correct).
Quote:
Originally Posted by Rogifan View Post

Cook just said Apple will NEVER make a a 7" device. He called 7" devices a "compromised product".

Aren't you glad then that Apple didn't go the 7" route?

Quote:
Originally Posted by AlexN View Post

Even stranger then that GOOG's share price is higher than APPL's. I'm off to do some digging 1smile.gif.

Please don't; you're already down under.
I’d rather have a better product than a better price.
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I’d rather have a better product than a better price.
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post #79 of 82

Interesting stat: In this quarter Apple (27M / 17% WW share) and Samsung (57M / 35% WW share) combined shipped more than one of every two smartphones. Not a lot of room for the dozens of other providers.

melior diabolus quem scies
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melior diabolus quem scies
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post #80 of 82
Quote:
Originally Posted by Rogifan View Post


I'm not talking about the comparison to competitors tablet products. I'm questioning why, at $329 are the margins significantly lower? I think many assumed the higher price than expected was to keep the high margins. According to Oppenheimer that isn't the case.


I'm one of those that is starting to doubt Apple's pricing strategy but more importantly am VERY concerned with supply chain challenges.  It's easy to armchair quarterback, but true...Apple has a problem with supply chain quantity and quality, which is affecting build cost.

 

My guess is that Cook would've loved to offer the 16GB/$299 and 32 GB/$399, thereby making up lower margins of the 16GB with sales of 32 GB, but two supply chain challenges prevented this:

- #1 is obvious...the higher build quality costs too much (as opposed to Nexus/Amazon)

- #2 is the BIGGEST CHALLENGE...unit quantity is CONSTRAINED, so why drop the price when every single one would be sold at $329/$429 anyway?

 

Mark my words, this is one market segment where Apple would've loved to make up lower profit margins with higher unit sales...but they since they can't make them fast enough, they can't lower cost.  Any dissenting opinion?

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