twolf2919

Mike Wuerthele said:

gatorguy said:

AppleInsider said:

Apple has continuously been buying back stock for the last seven years, and

retiring most of it...

Read on AppleInsider

Hasn't every share acquired under the repurchase program been retired? They can, of course, create new shares someday and sell them, but AFAIK every share in Apple's Repurchase Program has been effectively burned, it no longer exists. 

In the early days of the buy-back they did some other things with a small portion of the shares they re-acquired. For the last four years, as far as I can tell, every share has been completely retired.

When I say "most of it," that's like conservatively 96% have been retired.

Without these buy-backs, Apple's P/E would be even higher than the current 32 since earnings per share would be much lower.  

Apple has been bringing out some amazing AI-based solutions in the last couple years, including object recognition in the Photo app.  But Siri advances continue to be pathetic.  If Siri is an example of Apple's AI prowess, it's definitely behind on the AI curve.  I'm a big Apple fan - have all their devices - and was very enthusiastic when Siri first came out.  But over the years, Siri has moved inches, while competitors have moved miles - I can't believe a company that spends $22b on R&D can't make its voice assistant more useful in people's day-to-day lives.  So disappointing.

Not much motivation to write apps for the platform for a long while.  Whatever money/resources developers put into writing apps for it won't be recouped until there's a mass market, which won't happen until the prices come down by 2/3 at least and the headset becomes glasses.

“…didn’t provide the performance boost people tend to expect…” - who actually expects any performance boost in recent Apple Watches?  I’ve been using Apple Watches since the initial model and after the first couple, performance became a non-issue.  Nowadays, the only reason to upgrade is with the introduction of additional sensors - or longer battery life.  Battery and better GPS were the reasons I got the Ultra.

eightzero said:

mayfly said:

eightzero said:

OK, I really don't get this. How does GS lose money on a credit card? Are they paying Apple a disproportionate amount of their rake from the cardholders? The article says "credit losses" so somehow more Apple Card holders are welching? 

Or...it is possible GS thinks they just aren't making the billion they planned? Not sure that's a "loss."

Nope. They're losing plenty. Their customer acquisition cost is $350 per account. In addition, the Apple Card attracts a much more affluent demographic who pay their balances every month, depriving GS of interest charges. On top of that, there is the "buy now, pay later" program that allows customers to pay over 4 months without interest charges. That's how they're losing money. I wouldn't cry for GS, though. They made $10.9 billion in the second QUARTER of this year, even with the Apple Card losses.

OK, so I understand: GS pays Apple $350 for each new account, and since those new accounts generally don't pay GS interest (affluent customers) GS can't make back the $350? And who gets the swipe fee from merchants (that I am always asked to reimburse the merchant for)? Is there no swipe fee charged to a merchant on the Apple Card? GS doesn't get a cut of each transaction?

I am sure GS has overhead on these operations. They have to pay staff to provide customer service; and other infrastructure like IT and the like. But a billion in losses to that? Really?

The $350 "customer acquisition cost" is the cost of acquiring the customer - not the amount GS paid Apple.   These costs include advertising, sign-on incentives, etc.

The "swipe fee" consists of three things: a fee paid to the issuing bank (GS), a fee paid to Apple,  and a fee paid to the credit card company (Mastercard) for use of its network.

I suspect GS, which has never really been in consumer banking, has a lot of overhead that hasn't been optimized away yet and, as the original comment to you indicated, the users of Apple Card are more affluent than the average Joe and, likely, more financially savvy - especially with the help Apple Wallet gives them to keep on top of their spending - and, less likely to go into debt.  Add to this the other card benefits - Apple Cash, interest free repay on Apple products, etc. and I can see where a novice bank like GS ends up in the red.