Apple beats on revenue but sees profits fall for first time in a decade

13

Comments

  • Reply 41 of 79
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by drblank View Post




    Yeah, I know.  Google did $10 Billion in Net Profit for the entire year last year and Apple only does that in one quarter. 



    Again, please look at ALL the numbers. GOOG and AAPL have almost identical net profit margins of around 24%. Apple is a much larger company than Google.

  • Reply 42 of 79
    rayzrayz Posts: 814member

    Quote:

    Originally Posted by aaarrrgggh View Post





    Sure, if you are ok with $8B next year, $6.5B the following year, and $5.5B the next it is fine. The concern is not what they did today, it is that it isn't as good as yesterday, and what it might look like tomorrow! For a stockholder, the implied PE of that kind of move is about a 4.0.



    Their share repurchase plan sounds good; hopefully they already bought some 2014 calls and locked in the price before the announcement. Basically, the shares they are taking off the table reinforces the idea that they expect 15% declines in profits to be sustained for a while.



    Guess I won't be retiring any time soon. Oh well.


     


    Perhaps you should have diversified more.


     


    Folk the past year folk have been screaming that Apple needs to lower prices and take a margin to increase market share. This is kind of what it will look like, and it will probably get worse as Apple forks out more cash for data centres, manufacturing equipment and processes, and the not inconsiderable cost of dumping Samsung.

  • Reply 43 of 79
    drblankdrblank Posts: 3,383member

    Quote:

    Originally Posted by tooltalk View Post


     


    Samsung is really killing Apple..   According to Samsung's pre-earning guidance [1], Samsung's profit is up 50+% YOY or around $7+B for Q1 2013, narrowing the profit gap between the two companies.


     


    Apple 2Q iPhone yoy shipment growth is record low. I'm guessing that Q3 iPhone shipment will be even worse since the 5S is expected to be out in Q4 of 2013. 


     


     


























































































































































































    Quarters

    Unit Shipped

    QOQ

    YOY

     

     

    270,000

     

     

     

     

    1,119,000

    314.44

     

     

    1Q2008

    2,315,000

    106.88

     

     

     

    1,703,000

    -26.44

     

     

     

    717,000

    -57.90

    165.56

     

     

    6,892,000

    861.23

    515.91

     

    1Q2009

    4,363,000

    -36.69

    88.47

     

     

    3,793,000

    -13.06

    122.72

     

     

    5,208,000

    37.31

    626.36

     

     

    7,367,000

    41.46

    6.89

      iPhone 3S release (June)

    1Q2010

    8,737,000

    18.60

    100.25

     

     

    8,750,000

    0.15

    130.69

     

     

    8,400,000

    -4.00

    61.29

     

     

    14,102,000

    67.88

    91.42

      iPhone 4 release (June)

    1Q2011

    16,235,000

    15.13

    85.82

     

     

    18,650,000

    14.88

    113.14

     

     

    20,338,000

    9.05

    142.12

     

     

    17,070,000

    -16.07

    21.05

     

    1Q2012

    37,044,000

    117.01

    128.17

      iPhone 4S release (Oct)

     

    35,064,000

    -5.34

    88.01

     

     

    26,028,000

    -25.77

    27.98

     

     

    26,910,000

    3.39

    57.64

      iPhone 5 release (Sept Q4 2012)

    1Q2013

    47,789,000

    77.59

    29.01

     

     

    37,400,000

    -21.74

    6.66

     


     


     


     


    [1] Samsung's pre-earning guidance, April 05, 2013, http://www.samsung.com/us/aboutsamsung/news/newsIrRead.do?news_ctgry=irpublicdisclosure&news_seq=20528



    Samsung is not really comparable to Apple as a business model.  If you took out the actual portions of Samsung that are EXACTLY like Apple, you would have about 50% of the Revenue and Profits.  Apple doesn't make TVs, Appliances (refridgerators, cooktops, vacuum cleaners, washers/dryers, etc.),  cellular network equipment, component mfg, Insurance, shipbuilding, and a bunch of other things that Samsung does.  If you took out JUST the Samsung Mobile Division, Computing Division, Samsung is WAY below what Apple does in the exact same markets.  How much more would Apple do in revenues/profits, if they had an Appliance, TV division, and mfg components (panels, processors, memory chips, etc.) and sold to other customers?  


     


    Anyone that tries to compare Apple and Samsung is kind of misleading what Samsung does vs what Apple does.  Unfortunately, Samsung isn't going to strip out each of the financials from each division so that we can compare only those divisions from Samsung that are IDENTICAL to Apple.

  • Reply 44 of 79
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by drblank View Post




    Anyone that tries to compare Apple and Samsung is kind of misleading what Samsung does vs what Apple does. 



    You mean exactly like you just did moments ago when comparing Google and Apple?

  • Reply 45 of 79
    tooltalktooltalk Posts: 766member

    Quote:

    Originally Posted by philipm View Post


     


    Is Doctor Who big in your part of the world? Time Travel does have its benefits. Unless you don’t like Daleks. But seriously, Samsung issues an estimate of numbers ahead of a quarterly report.


     


    In any case, if Samsung is making less profit than Apple with a vastly bigger array of products (TVs, fridges, washing machines etc.) then I wouldn’t be using this to bash Apple.



     


    Well, the point here is that Samsung's revenue/profit growth rate driven largely by their mobile devices sales is greater than Apple's. Take for instance Samsung's last quarter result, Samsung Mobile's (IM) profit grew from $2.5B in 4Q 2011 to $5.4B in 4Q 2012.  Samsung's least profitable divisions like CE (Consumer Electronics) has never been a major profit center -- and likewise its Q4 2012 profit was $0.74B.

  • Reply 46 of 79
    People will never be happy! Apparently Apple is judged against totally unrealistic expectations. Today
    - they announced increased dividend - I hear it is highest in market
    - the increased stock but back. Again, highest in history.
    - Margin came done a little, but please show me other such a large company that does 35%+ of margin. This was because mainly due to lower margin Mini. And people all over blogosphere is asking for Apple to make more low priced iPhones.
  • Reply 47 of 79
    drblankdrblank Posts: 3,383member

    Quote:

    Originally Posted by mstone View Post


    Again, please look at ALL the numbers. GOOG and AAPL have almost identical net profit margins of around 24%. Apple is a much larger company than Google.



    Yeah,  Google doesn't really mfg anything.  They aren't in the same SEC sector as Apple.  Apple is actually considered a Personal Computing mfg and Google is more internet services.  Different Sector.  In addition, Apple has just shy of 1 Billion shares and Google has about 330 Million shares, so restructure all of the Google numbers and compare based on the same number of shares outstanding and Google doesn't look so good.  Google is also on a VERY slow growth rate. Apple has gone from a log growth rate, which obviously can't last forever and it's just slowing down since last year and that's part of the economy of what's going on in the industry.   Apple has also had product availability as an issue as it took Apple a while to get the iPhone 5, iPad mini, iMac product lines to ship to the demand levels.  Apple also didn't have any new product announcements last quarter, so that had a little impact.


     


    I'm not worried for the long term of Apple.  I'm sure they will easily get at least a 20 to 35% growth rate per year, which suggests that the Stock will at least double within the next 2+ years, which is what some shareholders are looking at.


     


    Apple is also going through their "getting away from Samsung" which will take at least a year or two to do the major share of that transition.  They are also investing a LOT of money in new panel and processor mfg with their business partners which sucks up cash.


     


    In terms of which stock would I invest in?   From a standpoint of what the potential growth rate is over the next 2 to 3 years, what stock is over/undervalued and which do I have more confidence in?  I would pick Apple right now.  They not only are paying a decent dividend, which will increase, they are WAY undervalued trading at a P/E of less than 10, whereas Google is trading at a very high P/E ratio.   Google hasn't proven themselves at making much, if any, profit from hardware sales.  if anything, that's a lost leader for them.  Motorola lost $330 Mil last December quarter, so that hasn't panned out yet.  I'm not very confident in Google Chromebooks making much money, Google Glass seems like a waste of time and I don't much in the future for Goole making much money from hardware and software sales.  It's all pretty much ad revenues and some coming from services.   BFD.

  • Reply 48 of 79
    stelligentstelligent Posts: 2,680member


    So much for the spike.

  • Reply 49 of 79
    pedromartinspedromartins Posts: 1,333member

    Quote:

    Originally Posted by stelligent View Post


    So much for the spike.



    it's hilarious, isn't it? lol

  • Reply 50 of 79
    drblankdrblank Posts: 3,383member

    Quote:

    Originally Posted by SolipsismX View Post





    Revenues per Mac were $1,378, the highest since 2008, per Horace Deidu. I'd say that's because of the new iMac. I don't expect profit margins to grow with their PCs as this segment will likely continue to slide in a post-PC world.


    I think the MacPro will improve their profit margins when they finally release it.  It's got a LOT of pent up demand, even though it's a niche product now.


     


    New laptops?  Everyone that studies the industry are waiting for the new laptops, etc. because they know that Haswell processors are in the wings, plus the new 802.11ac spec should be finalized soon and that will CERTAINLY help the AirPlay technology with regards to audio and video quality due to increased bandwidth, etc.  


     


    I don't know why the profit margins slipped other than they are going through the transition away from Samsung, having new panel technology which has to ramp up in terms of quality, etc. and that hurts margins until the components reach high yields.  I'm sure Apple's increased in R&D spending also hurts their overall Net Profit numbers as well.




    I have to look at the numbers and listen to the entire conference call to make any additional specific comments about the stock, but I STILL think that Apple trading at a P/E of less than 10 is undervalued.  I would see that for the next few years, a P/E of around 12 is average and 15 or 16 is on the high side.  So, with all of that, Apple should EASILY be trading in the 500's right now to be valued closer to reality.

  • Reply 51 of 79
    drblankdrblank Posts: 3,383member

    Quote:

    Originally Posted by mstone View Post


    You mean exactly like you just did moments ago when comparing Google and Apple?



    I was being sarcastic.  Do you know what sarcasm is?  I was just putting Google in their place by explaining that Apple does in one quarter what Google did all year long.    Do i have to spell the word "sarcasm" when posting?  I thought it was obvious.

  • Reply 52 of 79

    Quote:

    Originally Posted by drblank View Post


    Samsung is not really comparable to Apple as a business model.  If you took out the actual portions of Samsung that are EXACTLY like Apple, you would have about 50% of the Revenue and Profits.  Apple doesn't make TVs, Appliances (refridgerators, cooktops, vacuum cleaners, washers/dryers, etc.),  cellular network equipment, component mfg, Insurance, shipbuilding, and a bunch of other things that Samsung does.  If you took out JUST the Samsung Mobile Division, Computing Division, Samsung is WAY below what Apple does in the exact same markets.  How much more would Apple do in revenues/profits, if they had an Appliance, TV division, and mfg components (panels, processors, memory chips, etc.) and sold to other customers?  


     


    Anyone that tries to compare Apple and Samsung is kind of misleading what Samsung does vs what Apple does.  Unfortunately, Samsung isn't going to strip out each of the financials from each division so that we can compare only those divisions from Samsung that are IDENTICAL to Apple.



     


    Actually Samsung does break out some numbers. Mobile is about 48% of Samsung Electronics, so your 50% guess is damn close. What they don't break out is smartphone sales between their low-end and high-end phones. But it's easy to see a lot of them are low-end if you divide the sales by revenue and see what the average selling price is (about 1/2 of Apples average price for iPhones). But don't try to explain that to a hater - they don't like factual numbers when they can deal in FUD.


     


    But what else would you expect from tool, who always tried to twist numbers around and then gets made a fool of over and over. He must be into S&M to explain his continuing to come here and post garbage all the time.

  • Reply 53 of 79
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by drblank View Post




    ...


    I'm not worried for the long term of Apple.  I'm sure they will easily get at least a 20 to 35% growth rate per year, which suggests that the Stock will at least double within the next 2+ years, which is what some shareholders are looking at.


     


    Apple is also going through their "getting away from Samsung" which will take at least a year or two to do the major share of that transition.  They are also investing a LOT of money in new panel and processor mfg with their business partners which sucks up cash.


     


    In terms of which stock would I invest in?   From a standpoint of what the potential growth rate is over the next 2 to 3 years, what stock is over/undervalued and which do I have more confidence in?  I would pick Apple right now.  They not only are paying a decent dividend, which will increase, they are WAY undervalued trading at a P/E of less than 10, whereas Google is trading at a very high P/E ratio.  ...



    You are mixing up all kinds of different things. Firstly, I am not sure where you get 20-35% growth rate per year for the next 2-3 years? How does anyone know this? Secondly, although AAPL P/E is on the low side, the average P/E for Nasdaq is 17 which makes GOOG at 24 higher than average but I certainly wouldn't characterize that as a "Very High" P/E and thirdly Apple's cash does not factor into the earnings per share, profit, revenue, market cap or margin so that part of you rationalization is not part of the equation.


     


    I'm not arguing that Apple isn't a great company, but perhaps we should just leave the comparisons out of the discussion as there are too many skewed arguments when someone is so emotionally wrapped up in a particular stock. 

  • Reply 54 of 79
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by drblank View Post




    Quote:

    Originally Posted by mstone View Post


    You mean exactly like you just did moments ago when comparing Google and Apple?



    I was being sarcastic.  Do you know what sarcasm is?  I was just putting Google in their place by explaining that Apple does in one quarter what Google did all year long.    Do i have to spell the word "sarcasm" when posting?  I thought it was obvious.



    Actually I think the word sarcasm might have a different meaning than what you think it means.

  • Reply 55 of 79
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by drblank View Post




    So, with all of that, Apple should EASILY be trading in the 500's right now to be valued closer to reality.



    Yet Apple is guiding the revenue even lower for Q3 2013 to $33.5 billion, down $10 billion from Q2.

  • Reply 56 of 79

    Quote:

    Originally Posted by AppleInsider View Post





    The results for the three-month period ended March 30, 2013 compare to revenue of $39.2 billion and net profit of $11.6 billion, or $12.30 per diluted share, in the year-ago quarter. Gross margin was 37.5 percent, approximately 100 basis points lower than the 47.4 percent reported in the year-ago quarter, as consumers gravitated to more affordable, lower-margin products like the iPad mini.

     


    A minor quibble perhaps, but "100 basis points" is another way of saying "one percent." I think you meant to say 10%, or "1,000 basis points" if you prefer.

  • Reply 57 of 79


    Surprisingly some good convo going on here. The stock's basically flat now afterhours after a dip and jump as things get digested.


     


    It basically breaks (through Wall St logic) like this:


     


    The good: Dividend increase; thankfully don't have to hear about that anymore. beat earnings; in a barrage of rumors and negativity this was awesome. solid Chinese growth; WS always watching China...in line with rest of company


     


    The Meh: Stock buyback; some called for it but little overall impact. "new product categories coming"; everyone says good stuff is coming...talk is talk, for now.


     


    The not so good: Q3 forecast; important for stock direction and looks light in general. still no new product updates imminent; the drought goes on (for better or worse) and it means there's little to get 'excited' about from a stock perspective...also occurs when Apple's biggest competitor Samsung is rolling it's 'flagship' this Q.


     


    One thing is for sure, the floor is definitely in on the stock. Probably sideways trading and drifting higher until we a get a launch of something or the overall market makes a big move one or the other. 

  • Reply 58 of 79
    tribalogicaltribalogical Posts: 1,181member

    Quote:

    Originally Posted by aaarrrgggh View Post





    Sure, if you are ok with $8B next year, $6.5B the following year, and $5.5B the next it is fine. The concern is not what they did today, it is that it isn't as good as yesterday, and what it might look like tomorrow! For a stockholder, the implied PE of that kind of move is about a 4.0.



    Their share repurchase plan sounds good; hopefully they already bought some 2014 calls and locked in the price before the announcement. Basically, the shares they are taking off the table reinforces the idea that they expect 15% declines in profits to be sustained for a while.



    Guess I won't be retiring any time soon. Oh well.


     


    Speak for yourself. ;)


     


    Who said anything about a "trend"? One quarter does not a profit exodus make (repeating myself from another thread)…  and besides, it's equally unrealistic to expect a company can sustain 47% margins indefinitely. I'm quite happy with them returning to a more sustainable 37% range, especially if it means less stock volatility down the road.


     


    They guided lower for the next quarter, but I get a sense that the back half of the year is going to be pretty special. Long term there is nothing that points to diminishing profitability and revenue… on the contrary. Their revenues continue to increase (another record quarter), and there's no reason that won't also result in growing profit, even with these 'diminished' margins.


     


    I don't see the 'unhealthy company' you describe or worry over. As for their P/E I still believe it should be above 12, for my own reasons, so I think there's a ton of upside to the stock from where we sit...


     


    Up up and away...

  • Reply 59 of 79
    rogifanrogifan Posts: 10,669member
    Apple beat on revenue. Isn't that important? If people were buying less of their stuff revenues would be down no? And if they're getting more aggressive in certain markets with iPhone 4 shouldn't Wall Street be loving that since they're so obsessed with market share?
  • Reply 60 of 79
    tribalogicaltribalogical Posts: 1,181member

    Quote:

    Originally Posted by mstone View Post


    After hours share price is down a tad .03% but holding up pretty well considering all the predictions of doom.


     


    oops now it is up 4% so the street apparently likes the numbers.



    oops! and then it's down again… a bit of profit taking perhaps.

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