I'm well aware it's Apple-biased. That's why we're all here.
But it's presuming Microsoft is red faced about Apple's success. They may very well be, but it's written to sound as if someone at MS has admitted they've underestimated Apple.
The 10-K submission to the US Securities and Exchange Commission for fiscal year 2008 dances around mentioning Apple or its products by name but makes it clear that the smaller company's practice of building both iPhones, iPods and Macs, as well as the software that drives them, has become a concern that wasn't present in the fiscal year that came before.
"A competing vertically-integrated model, in which a single firm controls both the software and hardware elements of a product, has been successful with certain consumer products such as personal computers, mobile phones and digital music players," Microsoft says in the filing.
The Redmond, Washington-based company notes that it already has some vertically-integrated products, including its Xbox 360 game console and Zune line of portable media players, but that jumping any deeper into that business model may "increase [its] cost of sales" and "reduce operating margins."
As much of a Apple fan as I am, I have to admit the comparison is off base. Apple has grown by leaps and bounds but... MS made 4.37 Billion in profits in a bad quarter, Apple made 2.4 in a great one (when are we likely to see 7M iPhones ship again? I am hoping for 3-4 this quarter)
MS made 29% net profit in a cycle where it could be argued their products are not very popular. Apple made 20% net profit in the same time. I know the trend lines favor Apple, but 29% net when your products suck means any turnaround could be huge. I hope Apple can grow their market share, but in the macro environment, people will be buying fewer computers and products, it remains to be seen if they can steal enough of MS's thunder to not have their growth eaten into in a big way.
The day 25% of users know about the Mac, Microsoft and Windows will be history in three years.
That's absolutely true, and I have been saying this for many months already...MS has "won" on the basis of illegal monopolistic practices, attractive corporate packages and the fact that Apple stayed in the Limbo during the late 90s...now that the masses have FINALLY seen the light, there is no reason NOT to surpass MS in all financial terms...MS IS DEAD.
As I have said before on these forums, I have had much work of my own copied and imitated so I have a personal sympathy for Apple's position. Copying is easy, realizing dreams and staying one step ahead is hard work and often not so rewarding in profit.
I love Apple products as much as everyone else on here, but what you just said makes no sense to me. The highlights of Tiger and Leopard were all copied off someone else, or they bought the company that invented it. Since Leopard Apple's become more like Microsoft, its buggy, slow, now less secure than Vista and when Snow Leopard comes out they'll even be able to say its not compatible with all older Macs despite building the hardware.
Quote:
Originally Posted by aladin
Microsoft say that it have a tax to buy Apple product. By looking at those number it look like it have a bigger tax to buy Microsoft product! Seem that there method of marketing are bad
Not sure what you mean, but if the numbers show a company with a small market share can make almost as much as one with a big it means the smaller company is making way more per unit, hence a tax for the same thing.
Quote:
Originally Posted by markb
As much of a Apple fan as I am, I have to admit the comparison is off base. Apple has grown by leaps and bounds but... MS made 4.37 Billion in profits in a bad quarter, Apple made 2.4 in a great one (when are we likely to see 7M iPhones ship again? I am hoping for 3-4 this quarter)
Thats a great point, Apples doing well and MS is doing bad yet they still make more.
I don't really get the whole GAAP thing and what's included and what isn't in terms of subscriptions. But does the figure for MS include all the subscriptions? After all most people pay a license subscription to MS for their products.
"While Microsoft executives like to talk about Apple as an insignificant company with less than 5% of the worldwide market share of all PCs and servers sold, ...."
I thought MS's share of PC's "sold" is 0%.
MS's Zune share is about 3%, one sale for every 24 iPods sold.
MS's smartphone has a ??% market share.
Mac's North America/Europe share is around 14%, of the other 86% most of them are running a 7 year-old OS and "free" app's.
In Bill Gates office the Mac share is 50% (1-PC and 1-Mac).
In Steve Balmers dreams the shares are about even (25% Mac, 25% iPhone, 25% iPod and 25% OS X 10.5/10.6 and 25% Safari).
Don't forget Microsoft issued a $32 Billion dividend at the end of 2004.
And they have had a pretty aggressive stock buy back going on as well. While I like Apple a lot (I'm waiting on my new MBP now), and I'm a shareholder, this story is just lacking....
Microsoft is irrelevant, they may be a big company but no one gives a damn about them and no one is scared of them like before, no innovation is coming out from Redmond, they have become boring.
I think calling them irrelevant just makes you a fan boy...
If MS can't find a good use for the money (such as to buy somebody) they really need to give it back to the stock holders. That's what dividends are about. That's what companies are about. Unless they plan to buy someone big like Adobe, that's what Apple should do as well.
Hi,
The thing about Apple is that they invest very carefully. Consider that no Apple Store has ever closed. So, even if they have lots of ideas, they use up the cash slowly compared to most companies.
During this credit crisis and potential recession, I think it's great for Apple to just keep the cash on supply and maybe they will invest while prices are cheap - say open more Apple Stores or buy more knowledge. The real question will arise once the economy is healthy again. Then we should be asking what they plan to do with that cash pile.
My biggest concern as a consumer is that Apple could be tempted out of its winning formula by its increasing ability to compete with Microsoft. I think that is one of the reasons that Steve Ballmer sometimes taunts Apple with his 'advice'.
Microsoft wins through dominance and customer lock-in through proprietary data and system standards. So their ideal market share is 100%. But Apple's premium product positioning means that there's a sweet spot. Say 10% globally may be good for them (and us).
The really cool benefit of Microsoft's stumbles is that it could open the way for a more standards-based ecosystem. By supporting open standards Apple can play in the bigger pool with a modest market share, cherry-picking the best ideas, and offer the premium product that I want to buy.
My biggest concern as a consumer is that Apple could be tempted out of its current winning formula by its increasing ability to compete with Microsoft.
[...]
But Apple's premium product positioning means that there's a sweet spot. Say 10% globally may be good for them (and us).
If we figure 200 Million units sold worldwide, then 10% is 20M units. That is half of what they are doing now.
At 10%, I think, Apple's Mac platform would be receiving about the same profit that MS receives from their ~88% of Windows marketshare.
I truely am suprised at the hatred for Microsoft, they have done alot of good for the computer industry, and I honestly don't believe we would be were we are today if it were not for Microsoft. Not everyone can afford a Mac, and their prices and everyone's prices would be higher had it not been for the idea of licensing an OS to any copycat hardware.
Second you compare a company that makes ONLY software to a company that makes Hardware & Software. (In terms of a Computer)
In addition the MAJORITY of profits are not from OS X or Mac Hardware but from the iPod and iPhone (albeit with roots in OS X, which itself has roots in BSD, which is free and open source).
So this article is WRONG, WRONG, WRONG. And while I enjoy my Macbook, I also enjoy my Windows Media Center on Vista together with Blu-ray support.
Obviously Microsoft does see that Software will only bring them so much profit and have focused on the Xbox 360 and Zune. I would suggest to them to make a Windows Mobile or Zune phone themselves, perhaps even make their own PCs as its HP and Dell and Acer that give Vista a bad name...
For the record I own alot and compare, and neither companies offerings are 100% perfect. My phone is AT&T Tilt unlocked on T-Mobile. I own a White 30GB Zune, iPod Touch 8GB 2G, Macbook, HP Slimline for HTPC, built my own desktop, Xbox 360.
I truely am suprised at the hatred for Microsoft, they have done alot of good for the computer industry, and I honestly don't believe we would be were we are today if it were not for Microsoft.
Second you compare a company that makes ONLY software to a company that makes Hardware & Software. (In terms of a Computer)
In addition the MAJORITY of profits are not from OS X or Mac Hardware but from the iPod and iPhone (albeit with roots in OS X, which itself has roots in BSD, which is free and open source).
Huh? Microsoft has its OS on phones, lots of them.
Microsoft also makes an iPod competitor. How would that be in ANY way irrelevant to an apples vs apples comparison? True Microsoft does not make telephones as such. But they do make things like the XBox 360. To say Microsoft is not a hardware company is wrong. They do make hardware, and the Xbox and Zune are real Microsoft company products.
Just because Apple's iPhone OS and iPod product are so successful, does not the comparison irrelevant. Microsoft is asking for direct comparison. A
pple does make less money on its OS. iWork also makes far less money than Microsoft Office. Yet the products do compete.
Huh? Microsoft has its OS on phones, lots of them.
Microsoft also makes an iPod competitor. How would that be in ANY way irrelevant to an apples vs apples comparison? True Microsoft does not make telephones as such. But they do make things like the XBox 360. To say Microsoft is not a hardware company is wrong. They do make hardware, and the Xbox and Zune are real Microsoft company products.
Just because Apple's iPhone OS and iPod product are so successful, does not the comparison irrelevant. Microsoft is asking for direct comparison. A
pple does make less money on its OS. iWork also makes far less money than Microsoft Office. Yet the products do compete.
WRONG WRONG WRONG. A PC for example makes profit for both HP and Microsoft. A Mac makes profit only for Apple. (If you ignore Intel, Nvidia etc, as they make profit in both cases) Thus Microsoft is a software company and Apple is Hardware and Software in regards to Computers. I specifically stated that.
Microsoft did not do any comparison either, and neither did Analysts. Its fan driven website that is, and you are not comparing apples to apples (no pun intended). In fact its a stark reminder that the Mac is still way behind then it should be, and its the fact the iPhone and iPod are competively priced that they are doing so well.
A direct comparison of Zune vs iPod profits is welcome, and Apple obviously succeeds there. But a true comparison of the state of Microsoft would be a Windows vs OS X profits. Microsoft even beat analysts expectations, so its no suprise then that Apple had more profits as this has been expected based on analysts expectations on both sides. The whole spin has been as a failure when Microsoft and Vista is doing fine, and they are exceeding expectations with profits from Vista and Office. The ONLY reason Apple is up is do to the iPod and iPhone. I don't see how that threatens Windows, unless those users switch to Mac. Microsoft's core business is still Windows. While Apple has switched from being Apple Computer to Apple to focus on the iPod and iPhone.
The ONLY reason Apple is up is do to the iPod and iPhone.
You make some reasonable points, but Apple is up quite a bit in their Mac sales. It may pale in comparison to their other product categories, but Macs are getting 50% of its business from switchers. While I agree that MS has little to worry from Apple, the other PC vendors are worried. Apple's Mac sales account for 1/3 of all PC sales (that is by revenue, not unit sales) in the US.
You make some reasonable points, but Apple is up quite a bit in their Mac sales. It may pale in comparison to their other product categories, but Macs are getting 50% of its business from switchers. While I agree that MS has little to worry from Apple, the other PC vendors are worried. Apple's Mac sales account for 1/3 of all PC sales (that is by revenue, not unit sales) in the US.
That number is for "retail" computers only. The vast majority of the pc's are bought by corporations.
I truely am suprised at the hatred for Microsoft, they have done alot of good for the computer industry. [...]
Hi UltimateKylie, ( I like your username by the way )
I think that when people give credit to microsoft for what we can do with computers, microsoft's dominance means they often compare today with a world in which there were no computers on the desktop.
I am not old enough to remember all the early computers that were around, but there were alternatives that would have developed over the last 25 years. But microsoft has been unique in its refusal to implement basic security, and this has led to a world of malware and spam.
Consider also that unix-variants are dominant on servers and the internet and are taught at universities so this was one of the alternatives. Users of Linux / Ubuntu computers report that their computers take 5 seconds to start up, are completely stable and fast and never have viruses or become spambots. Imagine those systems with an extra 20 years of consumer development as an 'opportunity cost' of having Windows.
Bill Gates's, belief that users only want features and won't pay for a better engineered OS, plus his principle that it's ok to write inefficient code because the hardware will get faster, have not only brought software of dangerous incompetence into our lives and businesses, but have also trained the world to believe that viruses, spam, instability and an ever-increasing need to replace working hardware are a natural consequence of technology.
When people are losing their precious time, money, work or baby photos I think there is reason that some might hate Microsoft.
The 75% growth is inaccurate, because we have never been presented this number before, so you are comparing the total iphone revenues, to iphone revenues that were accounted for on a subscription basis a year ago. The number undoubtedly would still be very high, but not this astronomical. Also that big "non-gaap" home run number, counts all the iphone revenue from this quarters, as well as, the part of subscription for all previously sold iphones in prior quarters. GAAP would never allow this kind of accounting thats why they had to report it as non-GAAP
You're right about the 75% growth, which is a minor detail, since as you note, it's still a very high growth rate. I calculated that a year ago, if you did non-GAAP accounting you might have $6.6B in sales, not $6.2B. Compared to either number $11.7B is huge!
Where you're wrong is the second point you make. If you listened to the conference call, you would have heard Oppenheimer go thru how they calculated the non-GAAP figs. They backed out the previous deferred revenue, before adding in the current revenue. They're NOT that stupid. And, GAAP would allow this kind of accounting if Apple would only charge for significant feature upgrades to the iPhone and ATV. So far, this kind of accounting has saved iPhone users, one fee over the last 15 months. I think Apple has lost far more in analyst confusion than it has gained in goodwill by not charging its iPhone owners $10 for one new feature set.
...I do support for quite a few Apple based companies. Everyone still runs Office, and everyone still uses Windows server 2k3as well for exchange support. This is the area where Microsoft is moving to, even if you go past their games business which is doing rather well.
I do not understand why Apple is leaving the Server market to MS and Unix/Linux? OS X Server has some brilliant features such as: Spotlight Server, TimeMachine Server, the Wiki, and the simple intuitive interface; however, OS X Server is destructively unstable. All Apple needs to do is workout the instability issues, especially with Permissions & Keychain, add more permission control without having to run Terminal commands, add simple features like online backup for Windows workstation (since they can't do TimeMachine), and allow to NetBoot a Windows image. Also why is Apple not competing with Exchange Server?
If Apple treats server administrators professionally, they can quickly and easily give Windows 200x Server a run for its money, instead Apple is backing off again!
Comments
I'm well aware it's Apple-biased. That's why we're all here.
But it's presuming Microsoft is red faced about Apple's success. They may very well be, but it's written to sound as if someone at MS has admitted they've underestimated Apple.
They already have
The 10-K submission to the US Securities and Exchange Commission for fiscal year 2008 dances around mentioning Apple or its products by name but makes it clear that the smaller company's practice of building both iPhones, iPods and Macs, as well as the software that drives them, has become a concern that wasn't present in the fiscal year that came before.
"A competing vertically-integrated model, in which a single firm controls both the software and hardware elements of a product, has been successful with certain consumer products such as personal computers, mobile phones and digital music players," Microsoft says in the filing.
The Redmond, Washington-based company notes that it already has some vertically-integrated products, including its Xbox 360 game console and Zune line of portable media players, but that jumping any deeper into that business model may "increase [its] cost of sales" and "reduce operating margins."
MS made 29% net profit in a cycle where it could be argued their products are not very popular. Apple made 20% net profit in the same time. I know the trend lines favor Apple, but 29% net when your products suck means any turnaround could be huge. I hope Apple can grow their market share, but in the macro environment, people will be buying fewer computers and products, it remains to be seen if they can steal enough of MS's thunder to not have their growth eaten into in a big way.
The day 25% of users know about the Mac, Microsoft and Windows will be history in three years.
That's absolutely true, and I have been saying this for many months already...MS has "won" on the basis of illegal monopolistic practices, attractive corporate packages and the fact that Apple stayed in the Limbo during the late 90s...now that the masses have FINALLY seen the light, there is no reason NOT to surpass MS in all financial terms...MS IS DEAD.
As I have said before on these forums, I have had much work of my own copied and imitated so I have a personal sympathy for Apple's position. Copying is easy, realizing dreams and staying one step ahead is hard work and often not so rewarding in profit.
I love Apple products as much as everyone else on here, but what you just said makes no sense to me. The highlights of Tiger and Leopard were all copied off someone else, or they bought the company that invented it. Since Leopard Apple's become more like Microsoft, its buggy, slow, now less secure than Vista and when Snow Leopard comes out they'll even be able to say its not compatible with all older Macs despite building the hardware.
Microsoft say that it have a tax to buy Apple product. By looking at those number it look like it have a bigger tax to buy Microsoft product! Seem that there method of marketing are bad
Not sure what you mean, but if the numbers show a company with a small market share can make almost as much as one with a big it means the smaller company is making way more per unit, hence a tax for the same thing.
As much of a Apple fan as I am, I have to admit the comparison is off base. Apple has grown by leaps and bounds but... MS made 4.37 Billion in profits in a bad quarter, Apple made 2.4 in a great one (when are we likely to see 7M iPhones ship again? I am hoping for 3-4 this quarter)
Thats a great point, Apples doing well and MS is doing bad yet they still make more.
I don't really get the whole GAAP thing and what's included and what isn't in terms of subscriptions. But does the figure for MS include all the subscriptions? After all most people pay a license subscription to MS for their products.
I thought MS's share of PC's "sold" is 0%.
MS's Zune share is about 3%, one sale for every 24 iPods sold.
MS's smartphone has a ??% market share.
Mac's North America/Europe share is around 14%, of the other 86% most of them are running a 7 year-old OS and "free" app's.
In Bill Gates office the Mac share is 50% (1-PC and 1-Mac).
In Steve Balmers dreams the shares are about even (25% Mac, 25% iPhone, 25% iPod and 25% OS X 10.5/10.6 and 25% Safari).
Don't forget Microsoft issued a $32 Billion dividend at the end of 2004.
And they have had a pretty aggressive stock buy back going on as well. While I like Apple a lot (I'm waiting on my new MBP now), and I'm a shareholder, this story is just lacking....
Microsoft is irrelevant, they may be a big company but no one gives a damn about them and no one is scared of them like before, no innovation is coming out from Redmond, they have become boring.
I think calling them irrelevant just makes you a fan boy...
Bull. In what sense is this correct?
If MS can't find a good use for the money (such as to buy somebody) they really need to give it back to the stock holders. That's what dividends are about. That's what companies are about. Unless they plan to buy someone big like Adobe, that's what Apple should do as well.
Hi,
The thing about Apple is that they invest very carefully. Consider that no Apple Store has ever closed. So, even if they have lots of ideas, they use up the cash slowly compared to most companies.
During this credit crisis and potential recession, I think it's great for Apple to just keep the cash on supply and maybe they will invest while prices are cheap - say open more Apple Stores or buy more knowledge. The real question will arise once the economy is healthy again. Then we should be asking what they plan to do with that cash pile.
P.
Microsoft wins through dominance and customer lock-in through proprietary data and system standards. So their ideal market share is 100%. But Apple's premium product positioning means that there's a sweet spot. Say 10% globally may be good for them (and us).
The really cool benefit of Microsoft's stumbles is that it could open the way for a more standards-based ecosystem. By supporting open standards Apple can play in the bigger pool with a modest market share, cherry-picking the best ideas, and offer the premium product that I want to buy.
My biggest concern as a consumer is that Apple could be tempted out of its current winning formula by its increasing ability to compete with Microsoft.
[...]
But Apple's premium product positioning means that there's a sweet spot. Say 10% globally may be good for them (and us).
If we figure 200 Million units sold worldwide, then 10% is 20M units. That is half of what they are doing now.
At 10%, I think, Apple's Mac platform would be receiving about the same profit that MS receives from their ~88% of Windows marketshare.
Second you compare a company that makes ONLY software to a company that makes Hardware & Software. (In terms of a Computer)
In addition the MAJORITY of profits are not from OS X or Mac Hardware but from the iPod and iPhone (albeit with roots in OS X, which itself has roots in BSD, which is free and open source).
So this article is WRONG, WRONG, WRONG. And while I enjoy my Macbook, I also enjoy my Windows Media Center on Vista together with Blu-ray support.
Obviously Microsoft does see that Software will only bring them so much profit and have focused on the Xbox 360 and Zune. I would suggest to them to make a Windows Mobile or Zune phone themselves, perhaps even make their own PCs as its HP and Dell and Acer that give Vista a bad name...
For the record I own alot and compare, and neither companies offerings are 100% perfect. My phone is AT&T Tilt unlocked on T-Mobile. I own a White 30GB Zune, iPod Touch 8GB 2G, Macbook, HP Slimline for HTPC, built my own desktop, Xbox 360.
I truely am suprised at the hatred for Microsoft, they have done alot of good for the computer industry, and I honestly don't believe we would be were we are today if it were not for Microsoft.
Second you compare a company that makes ONLY software to a company that makes Hardware & Software. (In terms of a Computer)
In addition the MAJORITY of profits are not from OS X or Mac Hardware but from the iPod and iPhone (albeit with roots in OS X, which itself has roots in BSD, which is free and open source).
Huh? Microsoft has its OS on phones, lots of them.
Microsoft also makes an iPod competitor. How would that be in ANY way irrelevant to an apples vs apples comparison? True Microsoft does not make telephones as such. But they do make things like the XBox 360. To say Microsoft is not a hardware company is wrong. They do make hardware, and the Xbox and Zune are real Microsoft company products.
Just because Apple's iPhone OS and iPod product are so successful, does not the comparison irrelevant. Microsoft is asking for direct comparison. A
pple does make less money on its OS. iWork also makes far less money than Microsoft Office. Yet the products do compete.
Huh? Microsoft has its OS on phones, lots of them.
Microsoft also makes an iPod competitor. How would that be in ANY way irrelevant to an apples vs apples comparison? True Microsoft does not make telephones as such. But they do make things like the XBox 360. To say Microsoft is not a hardware company is wrong. They do make hardware, and the Xbox and Zune are real Microsoft company products.
Just because Apple's iPhone OS and iPod product are so successful, does not the comparison irrelevant. Microsoft is asking for direct comparison. A
pple does make less money on its OS. iWork also makes far less money than Microsoft Office. Yet the products do compete.
WRONG WRONG WRONG. A PC for example makes profit for both HP and Microsoft. A Mac makes profit only for Apple. (If you ignore Intel, Nvidia etc, as they make profit in both cases) Thus Microsoft is a software company and Apple is Hardware and Software in regards to Computers. I specifically stated that.
Microsoft did not do any comparison either, and neither did Analysts. Its fan driven website that is, and you are not comparing apples to apples (no pun intended). In fact its a stark reminder that the Mac is still way behind then it should be, and its the fact the iPhone and iPod are competively priced that they are doing so well.
A direct comparison of Zune vs iPod profits is welcome, and Apple obviously succeeds there. But a true comparison of the state of Microsoft would be a Windows vs OS X profits. Microsoft even beat analysts expectations, so its no suprise then that Apple had more profits as this has been expected based on analysts expectations on both sides. The whole spin has been as a failure when Microsoft and Vista is doing fine, and they are exceeding expectations with profits from Vista and Office. The ONLY reason Apple is up is do to the iPod and iPhone. I don't see how that threatens Windows, unless those users switch to Mac. Microsoft's core business is still Windows. While Apple has switched from being Apple Computer to Apple to focus on the iPod and iPhone.
The ONLY reason Apple is up is do to the iPod and iPhone.
You make some reasonable points, but Apple is up quite a bit in their Mac sales. It may pale in comparison to their other product categories, but Macs are getting 50% of its business from switchers. While I agree that MS has little to worry from Apple, the other PC vendors are worried. Apple's Mac sales account for 1/3 of all PC sales (that is by revenue, not unit sales) in the US.
You make some reasonable points, but Apple is up quite a bit in their Mac sales. It may pale in comparison to their other product categories, but Macs are getting 50% of its business from switchers. While I agree that MS has little to worry from Apple, the other PC vendors are worried. Apple's Mac sales account for 1/3 of all PC sales (that is by revenue, not unit sales) in the US.
That number is for "retail" computers only. The vast majority of the pc's are bought by corporations.
That number is for "retail" computers only. The vast majority of the pc's are bought by corporations.
Yes, I did forget to add the term retail.
I truely am suprised at the hatred for Microsoft, they have done alot of good for the computer industry. [...]
Hi UltimateKylie, ( I like your username by the way )
I think that when people give credit to microsoft for what we can do with computers, microsoft's dominance means they often compare today with a world in which there were no computers on the desktop.
I am not old enough to remember all the early computers that were around, but there were alternatives that would have developed over the last 25 years. But microsoft has been unique in its refusal to implement basic security, and this has led to a world of malware and spam.
Consider also that unix-variants are dominant on servers and the internet and are taught at universities so this was one of the alternatives. Users of Linux / Ubuntu computers report that their computers take 5 seconds to start up, are completely stable and fast and never have viruses or become spambots. Imagine those systems with an extra 20 years of consumer development as an 'opportunity cost' of having Windows.
Bill Gates's, belief that users only want features and won't pay for a better engineered OS, plus his principle that it's ok to write inefficient code because the hardware will get faster, have not only brought software of dangerous incompetence into our lives and businesses, but have also trained the world to believe that viruses, spam, instability and an ever-increasing need to replace working hardware are a natural consequence of technology.
When people are losing their precious time, money, work or baby photos I think there is reason that some might hate Microsoft.
( rant over
The 75% growth is inaccurate, because we have never been presented this number before, so you are comparing the total iphone revenues, to iphone revenues that were accounted for on a subscription basis a year ago. The number undoubtedly would still be very high, but not this astronomical. Also that big "non-gaap" home run number, counts all the iphone revenue from this quarters, as well as, the part of subscription for all previously sold iphones in prior quarters. GAAP would never allow this kind of accounting thats why they had to report it as non-GAAP
@ruffryder,
You're right about the 75% growth, which is a minor detail, since as you note, it's still a very high growth rate. I calculated that a year ago, if you did non-GAAP accounting you might have $6.6B in sales, not $6.2B. Compared to either number $11.7B is huge!
Where you're wrong is the second point you make. If you listened to the conference call, you would have heard Oppenheimer go thru how they calculated the non-GAAP figs. They backed out the previous deferred revenue, before adding in the current revenue. They're NOT that stupid. And, GAAP would allow this kind of accounting if Apple would only charge for significant feature upgrades to the iPhone and ATV. So far, this kind of accounting has saved iPhone users, one fee over the last 15 months. I think Apple has lost far more in analyst confusion than it has gained in goodwill by not charging its iPhone owners $10 for one new feature set.
...I do support for quite a few Apple based companies. Everyone still runs Office, and everyone still uses Windows server 2k3as well for exchange support. This is the area where Microsoft is moving to, even if you go past their games business which is doing rather well.
I do not understand why Apple is leaving the Server market to MS and Unix/Linux? OS X Server has some brilliant features such as: Spotlight Server, TimeMachine Server, the Wiki, and the simple intuitive interface; however, OS X Server is destructively unstable. All Apple needs to do is workout the instability issues, especially with Permissions & Keychain, add more permission control without having to run Terminal commands, add simple features like online backup for Windows workstation (since they can't do TimeMachine), and allow to NetBoot a Windows image. Also why is Apple not competing with Exchange Server?
If Apple treats server administrators professionally, they can quickly and easily give Windows 200x Server a run for its money, instead Apple is backing off again!
I think Apple has lost far more in analyst confusion than it has gained in goodwill by not charging its iPhone owners $10 for one new feature set.
That is something to consider. What would the stock valuation be if Apple wasn't using GAAP but charging for updates like it does with the iPod Touch?