Nothing much to see here except some overreactions. Things will bounce back to where they were — with pent-up demand filled — in the next quarter or two.
In the meantime, if it speeds up the process of becoming less dependent on China for both customers and suppliers, so much better for AAPL (and a lot of other companies) for the long haul.
Here is what I predict is going to happen because of Apple's announcement -
The stock and rest of the market will have a little hiccup, for a day. Just enough for people to cash-in and allow new buyers to get in.
Now since Apple has made this announcement, lot more people will come out and make similar announcements
The market, as on whole, will right off this quarter to the virus and lower the expectation for everyone, which will not impact the market much, as this is a temporary situation.
BTW, I thought Foxconn has assembly facilities outside of China, except maybe there would be some hiccup with some components. Let's not forget, Cook is a supply chain guy, I am sure he is no fool, he might have already addressed it.
Finally, maybe Tim is just throwing a curve ball :-)
No need to jump off APPL - Don't listen to Cramer, as you know he is going to make some stupid comment about APPL first thing in the morning.
Apple took some strategic decisions (just like everybody else). Whatever decisions you take, there are pros and contras.
Apple prefers a low inventory, JIT model. It has also decided to put its processor fabrication into the hands of a sole supplier.
There are advantages to that model but there are also disadvantages. It is difficult to have it both ways so you take the rough with the smooth.
Cook has said things are coming back online, just more slowly than expected.
They'll just have to weather the situation like everyone else.
This time it was a virus. It could have been a major earthquake in Taiwan, an extreme political situation (which we might get soon, btw) or terrorism etc.
You can't realistically operate by taking every single factor into account, just try to mitigate them when they arise.
This is an important statement to make at this time, not just for financial reasons, but to acknowledge that Apple will be acting with appropriate caution in reopening its retail and manufacturing operations in China.
This just shows that Cook should have diversified the Apple Assembly supply chain years ago.
His crystal ball was made my Samsung I guess.
"Samsung Electronics stands to be a major beneficiary of the China production problems announced by rival Apple Inc on Monday, reaping the rewards of a decade-long bet on low-cost smartphone manufacturing in Vietnam.
Half of Samsung’s smartphones are now made in Vietnam, where the coronavirus that has crippled the China operations of Apple and many other firms has so far had only a limited impact on its production."
And the "shareholder class action" suit gets filed in 3...2...1...
Why? I’m a shareholder. And don’t plan to sue. Apple, like every other publicly traded company has ups and downs. The companies that don’t issue statements when they know things are not going well are much worse than those that do. IMO.
Short answer, because they can.
Longer answer, I expect to see this because there is a history of self serving lawsuits, done “on shareholders behalf” but actually driven by greedy lawyers who take the lion’s share of any settlement. The most recent was in, I believe, in 2018. Apple issued their guidance in the fall, then the US-China trade war heated up and Apple had to revise downward sales Forecasts, especially in China. This hit stock prices. Within days there was one of these suits filed against Apple. The suit continued even after the stock had recovered from the bad quarter and in fact had gained well above those levels. I don’t know what happened to it, it might still be going on.
Do not underestimate the power of greed. You might understand these things, but there are always going to be unethical lawyers, and greedy/clueless stockholders that will try to make a quick buck in these situations. I don’t know what they will argue, but somehow they will try to portray the lost sales and consequent drop in stock value as Apple’s fault and any temporary reduction in the value of their holdings as an existential threat to their very survival.
They will also claim they are doing it for all Apple stockholders.
Welcome to the unacceptable face of US Capitalism. Americans made less over the last 20 years because they didn't want to do the work that other poor people in other countries would do at 0.001 of the US cost. As "Exceptional Americans" we just wanted to buy cheap goods - we sold our jobs for cheap toasters at Walmart. The US capitalist system failed working Americans.
I think you’re conflating free market capitalism with “capitalism”. We don’t have free market capitalism, we have a highly regulated economy and we have industries which are also highly regulated. Virtually every form of trade is regulated in the US. The difference between China and the US is the US Federal government does not own and direct large numbers of corporate interests, but there are a number of corporations which are powerful enough that they are able to limit competition with regulations. This is corporatism.
However, don’t for even one second pretend that there’s a problem with capitalism. Competition and capitalism are responsible for bringing more people out of poverty than any other system in world history.
That’s a variation of the “no true Scotsman” fallacy.
Welcome to the unacceptable face of US Capitalism. Americans made less over the last 20 years because they didn't want to do the work that other poor people in other countries would do at 0.001 of the US cost. As "Exceptional Americans" we just wanted to buy cheap goods - we sold our jobs for cheap toasters at Walmart. The US capitalist system failed working Americans.
I think you’re conflating free market capitalism with “capitalism”. We don’t have free market capitalism, we have a highly regulated economy and we have industries which are also highly regulated. Virtually every form of trade is regulated in the US. The difference between China and the US is the US Federal government does not own and direct large numbers of corporate interests, but there are a number of corporations which are powerful enough that they are able to limit competition with regulations. This is corporatism.
However, don’t for even one second pretend that there’s a problem with capitalism. Competition and capitalism are responsible for bringing more people out of poverty than any other system in world history.
That’s a variation of the “no true Scotsman” fallacy.
That’s a variation of the straw man argument
Lol. No it’s not. I didn’t make any argument. I pointed out a logical flaw.
Welcome to the unacceptable face of US Capitalism. Americans made less over the last 20 years because they didn't want to do the work that other poor people in other countries would do at 0.001 of the US cost. As "Exceptional Americans" we just wanted to buy cheap goods - we sold our jobs for cheap toasters at Walmart. The US capitalist system failed working Americans.
I think you’re conflating free market capitalism with “capitalism”. We don’t have free market capitalism, we have a highly regulated economy and we have industries which are also highly regulated. Virtually every form of trade is regulated in the US. The difference between China and the US is the US Federal government does not own and direct large numbers of corporate interests, but there are a number of corporations which are powerful enough that they are able to limit competition with regulations. This is corporatism.
However, don’t for even one second pretend that there’s a problem with capitalism. Competition and capitalism are responsible for bringing more people out of poverty than any other system in world history.
That’s a variation of the “no true Scotsman” fallacy.
That’s a variation of the straw man argument
Lol. No it’s not. I didn’t make any argument. I pointed out a logical flaw.
Oh good, we’re in agreement then that’s there’s no “true Scotsman” fallacy because otherwise there would be an argument.
Here is what I predict is going to happen because of Apple's announcement -
The stock and rest of the market will have a little hiccup, for a day. Just enough for people to cash-in and allow new buyers to get in.
Now since Apple has made this announcement, lot more people will come out and make similar announcements
The market, as on whole, will right off this quarter to the virus and lower the expectation for everyone, which will not impact the market much, as this is a temporary situation.
BTW, I thought Foxconn has assembly facilities outside of China, except maybe there would be some hiccup with some components. Let's not forget, Cook is a supply chain guy, I am sure he is no fool, he might have already addressed it.
Finally, maybe Tim is just throwing a curve ball :-)
No need to jump off APPL - Don't listen to Cramer, as you know he is going to make some stupid comment about APPL first thing in the morning.
Welcome to the unacceptable face of US Capitalism. Americans made less over the last 20 years because they didn't want to do the work that other poor people in other countries would do at 0.001 of the US cost. As "Exceptional Americans" we just wanted to buy cheap goods - we sold our jobs for cheap toasters at Walmart. The US capitalist system failed working Americans.
I think you’re conflating free market capitalism with “capitalism”. We don’t have free market capitalism, we have a highly regulated economy and we have industries which are also highly regulated. Virtually every form of trade is regulated in the US. The difference between China and the US is the US Federal government does not own and direct large numbers of corporate interests, but there are a number of corporations which are powerful enough that they are able to limit competition with regulations. This is corporatism.
However, don’t for even one second pretend that there’s a problem with capitalism. Competition and capitalism are responsible for bringing more people out of poverty than any other system in world history.
That’s a variation of the “no true Scotsman” fallacy.
That’s a variation of the straw man argument
Lol. No it’s not. I didn’t make any argument. I pointed out a logical flaw.
Oh good, we’re in agreement then that’s there’s no “true Scotsman” fallacy because otherwise there would be an argument.
We are not in agreement, but I doubt if I am going to get much sense out of your, so I will leave it there.
This just shows that Cook should have diversified the Apple Assembly supply chain years ago.
Yes, because of course he know that a pandemic global health outbreak would happen in Wuhan, where none of Apple's production facilities are, and anticipated how quickly it would spread. Because of course Armchair CEO is on record having predicted it ... oh wait no he isn't he's just talking out of biased ass again.
This is an important statement to make at this time, not just for financial reasons, but to acknowledge that Apple will be acting with appropriate caution in reopening its retail and manufacturing operations in China.
This just shows that Cook should have diversified the Apple Assembly supply chain years ago.
His crystal ball was made my Samsung I guess.
At the same group of factories IN CHINA as the iPhone, in fact!
Comments
In the meantime, if it speeds up the process of becoming less dependent on China for both customers and suppliers, so much better for AAPL (and a lot of other companies) for the long haul.
- The stock and rest of the market will have a little hiccup, for a day. Just enough for people to cash-in and allow new buyers to get in.
- Now since Apple has made this announcement, lot more people will come out and make similar announcements
- The market, as on whole, will right off this quarter to the virus and lower the expectation for everyone, which will not impact the market much, as this is a temporary situation.
- BTW, I thought Foxconn has assembly facilities outside of China, except maybe there would be some hiccup with some components. Let's not forget, Cook is a supply chain guy, I am sure he is no fool, he might have already addressed it.
- Finally, maybe Tim is just throwing a curve ball :-)
No need to jump off APPL - Don't listen to Cramer, as you know he is going to make some stupid comment about APPL first thing in the morning.Apple prefers a low inventory, JIT model. It has also decided to put its processor fabrication into the hands of a sole supplier.
There are advantages to that model but there are also disadvantages. It is difficult to have it both ways so you take the rough with the smooth.
Cook has said things are coming back online, just more slowly than expected.
They'll just have to weather the situation like everyone else.
This time it was a virus. It could have been a major earthquake in Taiwan, an extreme political situation (which we might get soon, btw) or terrorism etc.
You can't realistically operate by taking every single factor into account, just try to mitigate them when they arise.
"Samsung Electronics stands to be a major beneficiary of the China production problems announced by rival Apple Inc on Monday, reaping the rewards of a decade-long bet on low-cost smartphone manufacturing in Vietnam.
Half of Samsung’s smartphones are now made in Vietnam, where the coronavirus that has crippled the China operations of Apple and many other firms has so far had only a limited impact on its production."
Longer answer, I expect to see this because there is a history of self serving lawsuits, done “on shareholders behalf” but actually driven by greedy lawyers who take the lion’s share of any settlement. The most recent was in, I believe, in 2018. Apple issued their guidance in the fall, then the US-China trade war heated up and Apple had to revise downward sales Forecasts, especially in China. This hit stock prices. Within days there was one of these suits filed against Apple. The suit continued even after the stock had recovered from the bad quarter and in fact had gained well above those levels. I don’t know what happened to it, it might still be going on.