Apple to report Q3 2017 earnings on Aug. 1

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• Reply 1 of 11

  macky the macky Posts: 4,801member

  July 5, 2017 10:04PM

  Like always, I look forward to the commentary... I will buying a new iPhone after Apple releases its new models, but will be getting a new iPad Pro next month. Apple forever! 

  

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• Reply 2 of 11

  gregg thurman Posts: 456member

  July 5, 2017 11:13PM

  "but the progress was short lived as sales slumped in the second quarter of 2017. "
  
  Au Contraire.  Apple revenue did dip in the March quarter, but that is the norm.  Since FY2013 March quarter revenue has declined from December quarter levels an average of 26.4%.  That said March quarter 2017 saw revenue INCREASE 4.63% over the same period in 2016.
  
  After suffering 3 consecutive quarters of negative growth in 2016, Apple is on the verge of reporting 3 consecutive quarters of YoY growth,  The September quarter should make that 4 consecutive quarters, with FY2018 extending that growth trend to 8 consecutive quarters.

  

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• Reply 3 of 11

  lkrupp Posts: 10,557member

  July 5, 2017 11:26PM

  Apple is doing just fine, no matter what the blathering idiots say about Macs, iPhones, iPads, Apple Music, Siri, iCloud, or any other Apple product or service they trash on a regular basis.

  

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• Reply 4 of 11

  carnegie Posts: 1,084member

  July 5, 2017 11:47PM

  gregg thurman said:

  "but the progress was short lived as sales slumped in the second quarter of 2017. "
  
  Au Contraire.  Apple revenue did dip in the March quarter, but that is the norm.  Since FY2013 March quarter revenue has declined from December quarter levels an average of 26.4%.  That said March quarter 2017 saw revenue INCREASE 4.63% over the same period in 2016.
  
  After suffering 3 consecutive quarters of negative growth in 2016, Apple is on the verge of reporting 3 consecutive quarters of YoY growth,  The September quarter should make that 4 consecutive quarters, with FY2018 extending that growth trend to 8 consecutive quarters.

  The OP was referring to iPhone unit sales, not Apple's total revenue.
  
  On a sell-in basis, iPhone unit sales were down a little YoY in the second quarter. Revenue from iPhones was up a little and unit sales were up a little on a sell-through basis. But the number that is most often reported is the sell-in number, which was down some.

  edited July 2017

  

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• Reply 5 of 11

  jintech Posts: 1,092member

  July 5, 2017 11:51PM

  gregg thurman said:

  "but the progress was short lived as sales slumped in the second quarter of 2017. "
  
  Au Contraire.  Apple revenue did dip in the March quarter, but that is the norm.  Since FY2013 March quarter revenue has declined from December quarter levels an average of 26.4%.  That said March quarter 2017 saw revenue INCREASE 4.63% over the same period in 2016.
  
  After suffering 3 consecutive quarters of negative growth in 2016, Apple is on the verge of reporting 3 consecutive quarters of YoY growth,  The September quarter should make that 4 consecutive quarters, with FY2018 extending that growth trend to 8 consecutive quarters.

  Nah man, haven't you read? Apple is Doomed¡
  
  In all seriousness, I think this is going to be an awesome year for Apple in both financial gain and products. Can't wait for what's ahead!

  

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• Reply 6 of 11

  shapetables Posts: 201member

  July 6, 2017 12:17AM

  @lkrupp no, they're doing UltraFine and then there's https://www.bloomberg.com/news/videos/b/1df875df-fb0c-4020-bec7-e1f36cf299e3
  
  Seriously though, they could go full-Microsoft for the next decade and it would still be two more decades before they stop paying the gardeners. A lot of us have been using their technology since the last time that almost happened, though there were some defections...

  

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• Reply 7 of 11

  radarthekat Posts: 3,938moderator

  July 6, 2017 1:48AM

  shapetables said:

  @lkrupp no, they're doing UltraFine and then there's https://www.bloomberg.com/news/videos/b/1df875df-fb0c-4020-bec7-e1f36cf299e3
  
  Seriously though, they could go full-Microsoft for the next decade and it would still be two more decades before they stop paying the gardeners. A lot of us have been using their technology since the last time that almost happened, though there were some defections...

  Happily the defections were replaced with hindreds of millions of new customers who never used a Mac and still don't.  Your point about going two more decades even if they dropped into milking-the-cow Microsoft-mode is key, and reminds me of my Apple versus the world mind experiment.  It's in my notes somewhere here, let me dig that out... 

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• Reply 8 of 11

  radarthekat Posts: 3,938moderator

  July 6, 2017 1:52AM

  It's Apple earnings time.  Let's run the mind experiment again.  Maybe some analyst somewhere will finally gain some perspective.

  Apple Mind Experiment

  A mind experiment that should be performed by these analysts who see themselves as capable of running the show better than Cook would be to imagine the company as merely a black box.  Inside the box, out of sight and unnamed, resides a management team.  The company makes some products and plays in some markets, of which you are not aware.  You also don’t see the stock price.  And you aren’t aware that there was a CEO who died and was replaced with another member of the management team. 
  

  The only information you’re given is the financial metrics, total revenues and profits, cash and cash equivalents, etc, but nothing about the stock performance, with the provided financial numbers presented for each of the last five years.  Next to this information you are given the same information about other companies.  You don’t know that these other companies are Google and Amazon, or take your pick of companies to compare against.  
  

  Your job is to determine, with just the pertinent business metrics you’ve been handed, which company you would want to own a portion of; company X (AAPL), company Y (GOOGL), or company Z (AMZN).  

  Pretty sure most would laugh company Z right out of the competition.  

  And you’d likely think of company X that it must have some pretty great management and must be in some great lines of business, which go together, as it’s management that determines what businesses a company plays in.  You’d think whomever these guys are, the decisions they made over the five years, whether some were mistakes and others were great, in aggregate turned out pretty darned well.  And it’s therefore likely this same management is making good decisions today and will continue to do so in the future, with vastly more information and expertise in their field than those outside the company who so easily second-guess them.  
  

  This is the mind experiment I want Wall St. to run through its collective skull.
  

  Now imagine if Apple forced the issue by ending its reporting of unit sales numbers for individual products. If the company reported revenue in three categories (hardware, software, services) and total profit and gross margins for the entire company, not broken out. The stock might take an initial huge hit (which the company could take advantage of with a big buyback sweep) but after things settle down the analysts would be forced to focus their attention on what’s actually important about a business; how, in aggregate, through whatever set of decisions management has made, the company is doing in terms of revenues and earnings. Would Apple still get a multiple in the teens versus the 26x multiple assigned to CLX, a maker of bleach? Or the 27x multiple assigned to KO, a maker of soft drinks. By the way, something on the order of 80-90% of the population of the world who’s ever going to drink soft drinks already does, and so KO and PEP are in exactly the position the analysts dread Apple to be in; they are reliant upon repeat annual consumption by existing customers and their ability to convert customers from the competition’s brand. And yet, there it is, a 27+ multiple on KO.  So if you want to really address what the fanboys are all about, you’ll run the mind experiment and then address these comparisons.
  

  So many articles about Apple's earnings refer to growth, and mention prominently any decline in growth, and attribute that to saturated markets.  That's fine, big companies have declining growth rates in saturated markets.  The trouble is, a leveling out for Apple, versus any other maturing company on the planet, somehow in analyst's minds implies the end of the company. They believe, for some reason, that ongoing replacement sales and capturing customers from the competition are unworthy of any multiple on the stock. They must think the company in this scenario is worth zero, because not one of them will put forth a reasoned valuation relative to other businesses whose business has leveled off after a period of growth. BMW still sells cars at premium prices even in a world automobile market that isn't growing at the rate Apple's markets are still growing. Coach and other high-end fashion products companies still sell their wares at premium prices even in a world where functionally equivalent handbags sell at $40 at the local Sears. But they seem to believe they can second guess the future of Apple. And then they attribute to us investors all the wrong motivations for our angst. It's not about whether we think the iPad should have, or shouldn't have a USB port; it's that we see a very viable and valuable business, one that any of Apple's competitors would jump to switch places with, and we see that the value of that business and its future prospects are given short shrift by the very community (analysts) who are supposed to shed light on the topic.

  edited July 2017

  

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• Reply 9 of 11

  zimmermann Posts: 360member

  July 6, 2017 5:01AM

  It's an article in itself! Nicely put!

  edited July 2017

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• Reply 10 of 11

  rotateleftbyte Posts: 1,635member

  July 6, 2017 11:30AM

  Wall St will do its own thing (illogical as it may seem) and mark Apple down at every opportunity. Once you understand that you can sleep at night.
  I'm sure that there are people who make a very decent living shorting Apple.
  Logic be dammed. Microsoft is a darling and Apple is not. Pure and simple really.
  
  I bought my first lot of APPL stock in 2003. The broker asked "Why? They are going nowhere. They only appeal to geeks." I don't see much difference today. Despite the profits and the shareholder value Wall St hates APPL. IMHO, Apple should move domicile to somewhere that appreciates them a bit more.
  
  

  

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• Reply 11 of 11

  foggyhill Posts: 4,767member

  July 6, 2017 3:34PM

  radarthekat said:

  It's Apple earnings time.  Let's run the mind experiment again.  Maybe some analyst somewhere will finally gain some perspective.

  Apple Mind Experiment

  A mind experiment that should be performed by these analysts who see themselves as capable of running the show better than Cook would be to imagine the company as merely a black box.  Inside the box, out of sight and unnamed, resides a management team.  The company makes some products and plays in some markets, of which you are not aware.  You also don’t see the stock price.  And you aren’t aware that there was a CEO who died and was replaced with another member of the management team. 
  

  The only information you’re given is the financial metrics, total revenues and profits, cash and cash equivalents, etc, but nothing about the stock performance, with the provided financial numbers presented for each of the last five years.  Next to this information you are given the same information about other companies.  You don’t know that these other companies are Google and Amazon, or take your pick of companies to compare against.  
  

  Your job is to determine, with just the pertinent business metrics you’ve been handed, which company you would want to own a portion of; company X (AAPL), company Y (GOOGL), or company Z (AMZN).  

  Pretty sure most would laugh company Z right out of the competition.  

  And you’d likely think of company X that it must have some pretty great management and must be in some great lines of business, which go together, as it’s management that determines what businesses a company plays in.  You’d think whomever these guys are, the decisions they made over the five years, whether some were mistakes and others were great, in aggregate turned out pretty darned well.  And it’s therefore likely this same management is making good decisions today and will continue to do so in the future, with vastly more information and expertise in their field than those outside the company who so easily second-guess them.  
  

  This is the mind experiment I want Wall St. to run through its collective skull.
  

  Now imagine if Apple forced the issue by ending its reporting of unit sales numbers for individual products. If the company reported revenue in three categories (hardware, software, services) and total profit and gross margins for the entire company, not broken out. The stock might take an initial huge hit (which the company could take advantage of with a big buyback sweep) but after things settle down the analysts would be forced to focus their attention on what’s actually important about a business; how, in aggregate, through whatever set of decisions management has made, the company is doing in terms of revenues and earnings. Would Apple still get a multiple in the teens versus the 26x multiple assigned to CLX, a maker of bleach? Or the 27x multiple assigned to KO, a maker of soft drinks. By the way, something on the order of 80-90% of the population of the world who’s ever going to drink soft drinks already does, and so KO and PEP are in exactly the position the analysts dread Apple to be in; they are reliant upon repeat annual consumption by existing customers and their ability to convert customers from the competition’s brand. And yet, there it is, a 27+ multiple on KO.  So if you want to really address what the fanboys are all about, you’ll run the mind experiment and then address these comparisons.
  

  So many articles about Apple's earnings refer to growth, and mention prominently any decline in growth, and attribute that to saturated markets.  That's fine, big companies have declining growth rates in saturated markets.  The trouble is, a leveling out for Apple, versus any other maturing company on the planet, somehow in analyst's minds implies the end of the company. They believe, for some reason, that ongoing replacement sales and capturing customers from the competition are unworthy of any multiple on the stock. They must think the company in this scenario is worth zero, because not one of them will put forth a reasoned valuation relative to other businesses whose business has leveled off after a period of growth. BMW still sells cars at premium prices even in a world automobile market that isn't growing at the rate Apple's markets are still growing. Coach and other high-end fashion products companies still sell their wares at premium prices even in a world where functionally equivalent handbags sell at $40 at the local Sears. But they seem to believe they can second guess the future of Apple. And then they attribute to us investors all the wrong motivations for our angst. It's not about whether we think the iPad should have, or shouldn't have a USB port; it's that we see a very viable and valuable business, one that any of Apple's competitors would jump to switch places with, and we see that the value of that business and its future prospects are given short shrift by the very community (analysts) who are supposed to shed light on the topic.

  The important thing to a company is profit, not how they get it.
  

  Removing the device count would refocus on this for sure with some caveats.
  

  
  

  The problem right now is that they see Apple's ecosystem competing with the Android one (with thousands of companies).

  Everytime Apple sells less of anything, or even their share of that global market goes down, some hack analyst will spell gloom and doom for Apple because of this mostly flawed thinking that Apple by losing the quantity game is losing in a more general sense. It is mostly flawed thinking; but not completely flawed; Apple has to be mindful of inter-operativity and the network effect.
  

  
  

  There is one case were that would be the case, inter-operativity, the fact that Apple doesn't integrate tightly with Android is a boon if its platform never has to compete for something highly desirable on the other platform. But, if say everyone has many Android devices, then the platform itself could become an obstacle to a sales of an Apple device. That was certainly the case in the Windows vs Apple competition, and in the MS Office vs other office suites (and in all dominant software platforms, like the Adobe Suite).
  

  
  

  The way to counter that to offer a much better integrated experience of course; but, the network effect on the Android side could become a strong deterrent to sales in the mid market were people don't have many top end Apple devices. That's were analysts fears of lower device count and mine intersect. Apple has to be mindful of that.

  
  

  What helps Apple somewhat is the extreme fragmentation of the Android platform and the fact its high end features don't filter quickly to the low end.

  But, eventually, the base line of the Android platform, will be good enough, for most people's usage ; this is not the case, but it could reach that stage.

  
  

  Making something like AR a must have feature and pulling the minimum baseline up would be another way for Apple to counter.
  

  edited July 2017

  

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