It is amazing to see a company earn 18B in profit but lose 10-15B in market cap post earnings. The market seems as if it wants Google to over take Apple in market cap. I suspect that will happen by the next earnings release. Wall Street knows that apple's comps will be easier next year so Sept-October will most likely be when the stock will reverse trend. Until then I guess the multiple will drop below 10. Although a 10% drop in revenue next quarter does not equate to a 30% drop in component orders. I do wonder why the analyst did not harp on the supply chain rumors on the call
I am a little perplexed- how the hell did wall street overestimate the number of iPhones sold when they said that apple was having supply issues? Make up my freaking mind!
A sore spot but have been declining for like 2 years.
Just do not have the year (or two) over year upgrades like the iPhone has.
Of ourse, they got 18 billion in profits with sucky iPad sales.
Declining sales for two years indicates they have either had no strategy or a failed strategy at this point. Apple introduces three new products this year other than the iPhones and their revenue basically keeps pace with inflation. Between the new iPad Pro, a big upgrade of the apple TV, and the new Watch, they should have been able to have increase Revenue significantly
Blaming things on exchange rates is a cop out because Apple has adjusted prices in foreign markets to make up for changes in Currency valuations. Do they shout "We did good because the dollar was weak" when financials are good.
I don't get the hand-wringing (is there any?) over Macs. Apple usually moves between 3.5 and 5.5 million Macs every quarter. It's not only the most profitable computer lineup in the industry (that consistently outpaces the market in growth), but it's also Apple's most stable business. There will be peaks and troughs with Mac sales, but they'll usually be within that comfortable range.
No, sorry I don't think for one minute that Apple is "just fine" with iPad sales continuing to decline every quarter. Especially in a quarter where a brand new model was released. This was a 25% YOY decline. Who would be happy with that?!?
Seriously people buy junk tablets for under $100 now that didn't even exist when the iPad was introduced. Bottom line is there are now 50 manufactures that are losing their shirts just to buy into the market, so how can Apple maintain market share with the likes of Amazon just giving away tablets. Apple never cares about market share anyway they care about profits so eventually those customers buying junk will look for quality over cheap price tag.
The the iPad Air is $50-$100 over priced and the iPad Pro is $100-$150 over priced ( along with the Pencil which should be cut too). Apple should be cutting price to increase their market share so that they can increase their software and services for the long term. They need to think of the iPad as the true platform for replacing Windows machines.
Really the only thing that can stop this drop is the buyback.
I still conclude that Tim Cook has done a piss poor job of controlling the narrative. Slowing revenue growth in certain quarters is a fact of life when you are the size of Apple. Yet companies like Coke, McDonalds, and AT&T do not have PE's of 10 like Apple.
I think Cook needs to be fired.
We need a CEO to lead the next chapter of Apple from being a pure hardware player to a software/services giant.
Who should be the next CEO someone like Ballmer? Should the Board bring in Carl Fiorina (hey it promotes diversity). Do they promote from within someone like Phil Schiller or Craig Federigi. Either way I don't think it solves their problems. Services need to be stronger. Watch OS needs to be overhauled -- there's something plain wrong when Apple launches a product where the user needs training. The iPad Pro needs to have multi-user support to support both Families and Enterprises better. This should have been released a year ago on the IPad Air 2. Their needs to be two new 4 inch models - one high end 6S mini with a A9 chip and force touch for $575 and a 6C with A8 for $375.
Really the only thing that can stop this drop is the buyback.
I still conclude that Tim Cook has done a piss poor job of controlling the narrative. Slowing revenue growth in certain quarters is a fact of life when you are the size of Apple. Yet companies like Coke, McDonalds, and AT&T do not have PE's of 10 like Apple.
I think Cook needs to be fired.
We need a CEO to lead the next chapter of Apple from being a pure hardware player to a software/services giant.
Who should be the next CEO someone like Ballmer? Should the Board bring in Carl Fiorina (hey it promotes diversity). Do they promote from within someone like Phil Schiller or Craig Federigi. Either way I don't think it solves their problems. Services need to be stronger. Watch OS needs to be overhauled -- there's something plain wrong when Apple launches a product where the user needs training. The iPad Pro needs to have multi-user support to support both Families and Enterprises better. This should have been released a year ago on the IPad Air 2. Their needs to be two new 4 inch models - one high end 6S mini with a A9 chip and force touch for $575 and a 6C with A8 for $375.
Maybe you should put your name forward to become the new CEO? Sounds like you have all the answers!
Gotta love how reporting the largest profit of any quarter ever for a US company is somehow a disappointment. Google has barely made more money in the HISTORY of Android then AAPL made this quarter. Ridiculous.
I really don't see anything that needs to change drastically – that is, apart from the usual flow of change at Apple. There have been peaks and troughs in Apple quarterly performance (re: unit sales) in the past. iPhone sales are at an all time high, and coming off a holiday quarter, with the iPhone 7 still way over the horizon, it looks perfectly normal for Apple to lower guidance a little. Even if it's for the first time in x-number of years. Because this isn't 2010. Apple devices, at their price and margin points, have saturated the market up to their ability as price and margins allow (for now, anyway.) This is only concerning if Apple has no plans for growth. And it's lunacy to assume that they don't.
Services will naturally get stronger. It's a matter of course. They *have to* be stronger. I'm quite sure Tim and Jony know this. Apple Watch OS will as a matter of course improve. Just like iOS. Just like OS X. It's the Watch OS' what, first year on the market? Improvement is a given.
All of this will naturally sort itself out. Apple is not Microsoft, where the culture of the latter is totally inimical to meaningful, effective change. Apple *already* has a peerless, stable, evolving ecosystem in place, with an entire family of products that exploit it and work together seamlessly. No one else in the industry has the ecosystem/hardware/software infrastructure that Apple does. It's these *basics* (the fundamentals that Apple has always nailed) that should inspire continued confidence.
All the worry is much ado about nothing. Save it for there also-rans, like Microsoft and others. They're the ones that actually need it.
Who should be the next CEO someone like Ballmer? Should the Board bring in Carl Fiorina (hey it promotes diversity). Do they promote from within someone like Phil Schiller or Craig Federigi. Either way I don't think it solves their problems. Services need to be stronger. Watch OS needs to be overhauled -- there's something plain wrong when Apple launches a product where the user needs training. The iPad Pro needs to have multi-user support to support both Families and Enterprises better. This should have been released a year ago on the IPad Air 2. Their needs to be two new 4 inch models - one high end 6S mini with a A9 chip and force touch for $575 and a 6C with A8 for $375.
Maybe you should put your name forward to become the new CEO? Sounds like you have all the answers!
I put forward Sog as next CEO as he has all the answers to everything that ails Apple
Artificially? Using earnings or cash to buy back shares and therefore raise EPS doesn't strike me as artificial. The problem is when EPS is taken as a guiding measure on its own. EPS is just a single data point, so using it as a singular basis for investment is foolish; cashflow, debt, assets and (of course) future projections are also critically important.
Artificially? Using earnings or cash to buy back shares and therefore
raise EPS doesn't strike me as artificial. The problem is when EPS is
taken as a guiding measure on its own. EPS is just a single data point,
so using it as a singular basis for investment is foolish; cashflow,
debt, assets and (of course) future projections are also critically
important.
I really hate it when people clip thoughts in mid-sentence. The parts you clipped
were (in bold), "Among other things, buybacks artificially increase EPS, and there comes a time it doesn't matter if revenues are
steadily decreasing." I had specifically given IBM as an example of that
just before, and I went on to talk about one way I thought Apple was trying to avoid IBM's fate, i.e. the stock price crashing despite spending all that money buying back shares. Further, I was responding over several messages to someone who had fixated on EPS, and I was trying to convey how it can be manipulated, and why it's not that meaningful in isolation.
Artificially? Using earnings or cash to buy back shares and therefore
raise EPS doesn't strike me as artificial. The problem is when EPS is
taken as a guiding measure on its own. EPS is just a single data point,
so using it as a singular basis for investment is foolish; cashflow,
debt, assets and (of course) future projections are also critically
important.
I really hate it when people clip thoughts in mid-sentence. The parts you clipped
were (in bold), "Among other things, buybacks artificially increase EPS, and there comes a time it doesn't matter if revenues are
steadily decreasing." I had specifically given IBM as an example of that
just before, and I went on to talk about one way I thought Apple was trying to avoid IBM's fate, i.e. the stock price crashing despite spending all that money buying back shares. Further, I was responding over several messages to someone who had fixated on EPS, and I was trying to convey how it can be manipulated, and why it's not that meaningful in isolation.
Fair enough. Sorry, I didn't read the post you were responding too, and just thought the language choice was odd. I still think "artificially" isn't really the right word, but the added context is appreciated.
I really hate it when people clip thoughts in mid-sentence. The parts you clipped
were (in bold), "Among other things, buybacks artificially increase EPS, and there comes a time it doesn't matter if revenues are
steadily decreasing." I had specifically given IBM as an example of that
just before, and I went on to talk about one way I thought Apple was trying to avoid IBM's fate, i.e. the stock price crashing despite spending all that money buying back shares. Further, I was responding over several messages to someone who had fixated on EPS, and I was trying to convey how it can be manipulated, and why it's not that meaningful in isolation.
Fair enough. Sorry, I didn't read the post you were responding too, and just thought the language choice was odd. I still think "artificially" isn't really the right word, but the added context is appreciated.
No problem. I get what you're saying. I guess the "artificialness" I was thinking of can apply to the perception of how a company is doing when just the EPS is considered, rather than the EPS itself, which all other things being equal, does go up when the share count goes down. There's so much that can't necessarily be taken at face value. For example, it was revealed in the Q&A that the reported 40.1% gross margin included 40 basis points due to a one-time patent settlement, and so the "real" gross margin was 39.7%.
Comments
Blaming things on exchange rates is a cop out because Apple has adjusted prices in foreign markets to make up for changes in Currency valuations. Do they shout "We did good because the dollar was weak" when financials are good.
Services will naturally get stronger. It's a matter of course. They *have to* be stronger. I'm quite sure Tim and Jony know this. Apple Watch OS will as a matter of course improve. Just like iOS. Just like OS X. It's the Watch OS' what, first year on the market? Improvement is a given.
All of this will naturally sort itself out. Apple is not Microsoft, where the culture of the latter is totally inimical to meaningful, effective change. Apple *already* has a peerless, stable, evolving ecosystem in place, with an entire family of products that exploit it and work together seamlessly. No one else in the industry has the ecosystem/hardware/software infrastructure that Apple does. It's these *basics* (the fundamentals that Apple has always nailed) that should inspire continued confidence.
All the worry is much ado about nothing. Save it for there also-rans, like Microsoft and others. They're the ones that actually need it.