Yep, just go ahead and make things up. You know, that's just false for most of the year. But as with any company of this type, when a product release is nearing, hours get long, and more dats are out in. They do get paid pretty well though.
My buddy Evan worked for Apple when he lived in Sacramento years ago when it was still Jobs & Co. He really liked working for Apple, but never owned a single Apple product, even though when the iPhone was released he could have had a non-resale unit for free. I don't know what he had "against" Apple products, but he was always an custom-hardware guy. He still uses a Nokia something or other running Symbian.
@melgross: "Yep, just go ahead and make things up. You know, that's just false for most of the year." Err, ... , you clearly haven't worked at Apple (Well, perhaps not in an engineering role). Most engineering companies have cycles, as you say, between periods of high intensity and overtime and periods of relatively low intensity. We like to call this feast or famine. At apple, you are always drinking from the hose. The only question is whether it is a garden hose or a fire hose. If you are not, you should be concerned about your job security.
like a electric car? untapped market ready to expload if they can get the mileage range up to 200 and the car affordable to the middle class ($35,000 and under)
Except that an electric car is still at least 4 years away. And even then, Apple isn't going to produce their own car, but provide an exclusive suite of software and hardware within other cars. But even IF they go ahead and do their own car, that's also further down the road. Apple is late to the party.
And even when the car comes out, it will take many years to scale. Apple is incredibly reliant on a single product. They've escaped gravity for some time, but they can't prolong the inevitable. They have no real diversification which can carry these revenue numbers except their phone(s).
$7.491b in personal systems in the July quarter, down from $8.649b the same quarter last year. I mean, $7.491b is good revenue, but not good earnings! They only made $222m, and for Apple to hit that same level of earnings they would have to only make $46 per iPad. If HP had the same kind of revenue Apple does (they reported gross margin of 39% that quarter) they would be making $2.92b, over 10x their current earnings. Apple's earnings: http://investor.apple.com/secfiling.cfm?filingID=1...
Only $4.276b revenue, so a good chunk lower than HP, but at 39% margin still over 5x more earnings.
@Mondozai: "But even IF they go ahead and do their own car, that's also further down the road. Apple is late to the party."
That didn't stop them with the smartphone market. Contrary to popular belief, not only didn't they invent the smart phone, but there were technically superior options (for many use cases at the time) available. The original iPhone was extremely limited in capability. Blackberries had better email and enterprise features. I had the capability to remote into PCs with a Palm Treo. Whether Apple's success with the iPhone came from their total buyout of the early runs of capacitive touch screens, their ability to make the UI simple, their ability to appeal to the average consumer, etc is irrelevant. They've proven that they can build a product that people will buy even without being the most technically superior or cost effective offering.
The question I would ask is whether or not the margins will be high enough to be of interest to them. I would guess that, if anything, they would be more interested in building the electronics (software / hardware) for it than building the platform itself for the simple reason that margins would likely be a lot higher.
Building a car is very different from building a smartphone. Margins are much lower, suppliers are more powerful and there are existing strong brands. If my cars broke as often as my iPhone have, I would be very unhappy indeed.
Apple is used to being able to leverage its position as a pretty dominant buyer to get exclusivity agreements, full stock buyouts, multiple vendors competing for their business, etc.. If they are just another (small) customer, then they won't be able to differentiate nearly as much. Then again, if they are buying the same parts as everyone else, perhaps the reliability will be more similar to other vehicles than your iPhones.
I find it extremelly amusing when you mentioned that Apple is able to leverage its position.
Electric cars are (currently) a niche product, and Apple does not have any foothold whatsoever in the auto industry. How do you expect a Company that will likely make less than a million car a year be able to negotiate a good deal with multiple vendors when it is a tiny player in the auto industry?
You also fail to realize that existing Auto companies are Giants themselves..
Dude, all these arguments could have been used in 2007 when Apple entered the Phone market... So I don't think they would fail because of any of those reasons 😃
Cash. As with all things, Apple can write a check and have access to whatever they need. You use the million car mark as a threshold and you see they could then compare to Mercedes; they only sold 1.7m cars last year, up from 1.46m in 2013. Yet Mercedes does fine. Mercedes only has about $12b cash holdings as of 2011 (couldn't find anything more recent), while Apple has as of July over $200b. That means, if they wish, they could buy both VW ($57b) and BWM ($59b) at 20% over current market cap and still have $70b in cash holdings.
Mercedes does fine, but they also have normal margins just like everybody else. Remember a poster suggested that Apple will be able to leverage its "position" in earning and above average margin in the industry..
That simply won't work and a car is not a smartphone.
You also mentioned the acquisitions of BMW and VW. That would certainly make them immediately a big player but at what cost? It's an entirely different business. Further any supposed gains from "leveraging" with a supplier is most likely immaterial because BMW and VW would have already leverages their positions already.
The bottom line is, people need to stop assuming that cars have a lot of untapped savings potentials that can contribute to the bottom line. Car manufacturing is one of the most studied and engineering processes out there, is capital intensive and consume a lot of raw materials. Savings don't just appear suddenly.
I wasn't arguing any 'untapped savings' potential. I was only arguing that Apple has the resources to immediately step up to the adult's table, bypassing the kid's table, with their size and cash reserves. Tesla, as an example, has to be careful and cautious with it's build out as they improve their cash flow. Apple has no cash flow problem and can immediately order the necessary parts, components, or designs.
There is a market with hybrids (2 in 1 devices ) rising. Apple should not have a problem to re-invent its own version of Surface Pro or Book with desktop OS. That could keep Apple holding very strong for next 5-7 years. By that time they will figure out what to do next. If not they will just make less money but still be in profit.
They are already heading this direction with the iPad Pro, so I suspect this is indeed a part of their strategy.
@milkod2001: "By that time they will figure out what to do next. If not they will just make less money but still be in profit."
So many people forget this. It isn't as if the market is suddenly shrinking. It has just slowed down as typically happens with market saturation. The PC market is shrinking, yet HP, Dell, Lenovo, Asus, et al are still making plenty of money.
yeah they need to stop giving anandtech early review units.. save those few review units for sites that will actually review the phone within the first 3 weeks.
Apple are doing great, except their stock price hasn't moved. Compared to MS and other Tech trading at 30+ P/E. Apple is now trading at P/E 12.x and has more cash then Google + Microsoft tech reserve combined.
Because they have guided to 1%-4% revenue growth in Dec quarter, despite it including the first Christmas sales for Apple Watch, iPad Pro and MacBook. And it includes an additional week over last Dec quarter. This implies that iPhone revenues are going to be down and maybe even units too, giving they are lapping the big ASP uplift. The warning a few days ago from Dialog Semi is additional evidence of iPhone stagnating. Apple is becoming a mature business in its main profit driver and that doesn't warrant a high PE.
Exactly. They talk about Apple too rely on a single product. the iPhone. And Google has multiple product and diversify... Gmail , search, hosting..... yeah... Oh. They don't make any money at all. How do Google make money? Advertising. Microsoft..... not making more Windows license, not getting more office sales, and Its Azure cloud are making a low single digit profits while its irrelevant search engine is profitable deserve a 35 P/E named as a growth company....
Both these companies have solid services that are more perennial than fickle consumerism. You're forgetting that Apple is not just a tech company selling smartphones and computers. They sell status symbol, fashion icons. Apple doesn't have retail stores, they have temples.
People sell their kidneys for iphones in China; a huge scalper and smuggling market exists for it. Are you really sure they are in love with the BSD flavor of osx/ios?
I dunno, it sounds like you're describing Apple as the one with the less fickle product here.
Google has already announced that mobile marketshare for search dwarfs desktop marketshare, for example, and Microsoft has reported that their PC licensing has fallen now in terms of revenue for several quarters.
It would appear that Apple's growing iPhone sales (and yes, they are still growing seven years later) is the stronger business model at this point than ads or OS sales. I mean, after all, if Google disrupted existing ad business then it stands to reason their own ad business isn't bulletproof, and if Google's Android disrupted Microsoft's OS licensing model then... yes, neither Android nor Windows licenses are either bulletproof.
Which means people selling their kidneys for iPhones is the best way forward. So far no one has successfully disrupted Apple.
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ThisIsChrisKim - Tuesday, October 27, 2015 - link
Eye popping revenue and profit. Apple employees get treated well, I assume?jibberegg - Tuesday, October 27, 2015 - link
Between 12 hour days and working over weekends, yup. Welcome to the less glitzy side of Silicon Valley.osxandwindows - Tuesday, October 27, 2015 - link
An apple university professor urns dollar 1.7m a year.junky77 - Tuesday, October 27, 2015 - link
There is much more "less glitzy" side of silicon valley, but tech sites never really talk about itfreeskier93 - Tuesday, October 27, 2015 - link
Welcome to the world of engineering. If you're young and like what you do it's really not that bad and isn't much different then school.melgross - Tuesday, October 27, 2015 - link
Yep, just go ahead and make things up. You know, that's just false for most of the year. But as with any company of this type, when a product release is nearing, hours get long, and more dats are out in. They do get paid pretty well though.Samus - Wednesday, October 28, 2015 - link
My buddy Evan worked for Apple when he lived in Sacramento years ago when it was still Jobs & Co. He really liked working for Apple, but never owned a single Apple product, even though when the iPhone was released he could have had a non-resale unit for free. I don't know what he had "against" Apple products, but he was always an custom-hardware guy. He still uses a Nokia something or other running Symbian.BurntMyBacon - Wednesday, October 28, 2015 - link
@melgross: "Yep, just go ahead and make things up. You know, that's just false for most of the year."Err, ... , you clearly haven't worked at Apple (Well, perhaps not in an engineering role). Most engineering companies have cycles, as you say, between periods of high intensity and overtime and periods of relatively low intensity. We like to call this feast or famine. At apple, you are always drinking from the hose. The only question is whether it is a garden hose or a fire hose. If you are not, you should be concerned about your job security.
lilmoe - Tuesday, October 27, 2015 - link
That's one nasty head and shoulders pattern in the charts...Samus - Wednesday, October 28, 2015 - link
Obviously intentional ;)lilmoe - Wednesday, October 28, 2015 - link
I don't know what you mean by intentional, but these patterns are starting to show for multiple stocks and indices, most obvious of them being AAPL's.Volumes are going down too:
http://finance.yahoo.com/echarts?s=aapl#{%22showAr...
If I owned AAPL stock I'd sell a good portion now or wait for a good rally and sell for better profit. This honestly ain't looking too good for bulls.
boozed - Tuesday, October 27, 2015 - link
"I tend to think of Apple as iPhone and other stuff"Surprising to see the fruit flavoured computer substitutes outselling the awkwardly named fondleslabs though.
mgl888 - Tuesday, October 27, 2015 - link
I feel like the smartphone market is starting to saturate too. I wonder how Apple will diversify later.Morawka - Tuesday, October 27, 2015 - link
like a electric car? untapped market ready to expload if they can get the mileage range up to 200 and the car affordable to the middle class ($35,000 and under)Mondozai - Wednesday, October 28, 2015 - link
Except that an electric car is still at least 4 years away. And even then, Apple isn't going to produce their own car, but provide an exclusive suite of software and hardware within other cars. But even IF they go ahead and do their own car, that's also further down the road. Apple is late to the party.And even when the car comes out, it will take many years to scale. Apple is incredibly reliant on a single product. They've escaped gravity for some time, but they can't prolong the inevitable. They have no real diversification which can carry these revenue numbers except their phone(s).
Morawka - Wednesday, October 28, 2015 - link
6 or 7 billion on every single category is great revenue for any company.. Sure the iPhone sells more but your under-selling apple's other products.Dell or HP would kill for 6 billion in revenue for a quarter on PC's..
Speedfriend - Wednesday, October 28, 2015 - link
"Dell or HP would kill for 6 billion in revenue for a quarter on PC's."Yes, kill their sales teams for the fall in revenues. HP does $8-9bn of quarterly PC revenues.
Given Dell sold 10m PCs last quarter, I am pretty sure that they do at least $6bn in revenue!
michael2k - Wednesday, October 28, 2015 - link
HP? No they don't:http://h30261.www3.hp.com/~/media/Files/H/HP-IR/do...
$7.491b in personal systems in the July quarter, down from $8.649b the same quarter last year. I mean, $7.491b is good revenue, but not good earnings! They only made $222m, and for Apple to hit that same level of earnings they would have to only make $46 per iPad. If HP had the same kind of revenue Apple does (they reported gross margin of 39% that quarter) they would be making $2.92b, over 10x their current earnings. Apple's earnings:
http://investor.apple.com/secfiling.cfm?filingID=1...
Only $4.276b revenue, so a good chunk lower than HP, but at 39% margin still over 5x more earnings.
BurntMyBacon - Wednesday, October 28, 2015 - link
@Mondozai: "But even IF they go ahead and do their own car, that's also further down the road. Apple is late to the party."That didn't stop them with the smartphone market. Contrary to popular belief, not only didn't they invent the smart phone, but there were technically superior options (for many use cases at the time) available. The original iPhone was extremely limited in capability. Blackberries had better email and enterprise features. I had the capability to remote into PCs with a Palm Treo. Whether Apple's success with the iPhone came from their total buyout of the early runs of capacitive touch screens, their ability to make the UI simple, their ability to appeal to the average consumer, etc is irrelevant. They've proven that they can build a product that people will buy even without being the most technically superior or cost effective offering.
The question I would ask is whether or not the margins will be high enough to be of interest to them. I would guess that, if anything, they would be more interested in building the electronics (software / hardware) for it than building the platform itself for the simple reason that margins would likely be a lot higher.
Speedfriend - Wednesday, October 28, 2015 - link
Building a car is very different from building a smartphone. Margins are much lower, suppliers are more powerful and there are existing strong brands. If my cars broke as often as my iPhone have, I would be very unhappy indeed.BurntMyBacon - Wednesday, October 28, 2015 - link
I don't not agree with anything you said here.Apple is used to being able to leverage its position as a pretty dominant buyer to get exclusivity agreements, full stock buyouts, multiple vendors competing for their business, etc.. If they are just another (small) customer, then they won't be able to differentiate nearly as much. Then again, if they are buying the same parts as everyone else, perhaps the reliability will be more similar to other vehicles than your iPhones.
mattbe - Wednesday, October 28, 2015 - link
I find it extremelly amusing when you mentioned that Apple is able to leverage its position.Electric cars are (currently) a niche product, and Apple does not have any foothold whatsoever in the auto industry. How do you expect a Company that will likely make less than a million car a year be able to negotiate a good deal with multiple vendors when it is a tiny player in the auto industry?
You also fail to realize that existing Auto companies are Giants themselves..
jospoortvliet - Wednesday, October 28, 2015 - link
Dude, all these arguments could have been used in 2007 when Apple entered the Phone market... So I don't think they would fail because of any of those reasons 😃Michael Bay - Thursday, October 29, 2015 - link
Bitch please, they had a longstanding relationship with iPod manufacturers in China, that`s why iPhone could happen.In cars they have nothing.
michael2k - Wednesday, October 28, 2015 - link
Cash. As with all things, Apple can write a check and have access to whatever they need. You use the million car mark as a threshold and you see they could then compare to Mercedes; they only sold 1.7m cars last year, up from 1.46m in 2013. Yet Mercedes does fine. Mercedes only has about $12b cash holdings as of 2011 (couldn't find anything more recent), while Apple has as of July over $200b. That means, if they wish, they could buy both VW ($57b) and BWM ($59b) at 20% over current market cap and still have $70b in cash holdings.mattbe - Thursday, October 29, 2015 - link
Mercedes does fine, but they also have normal margins just like everybody else. Remember a poster suggested that Apple will be able to leverage its "position" in earning and above average margin in the industry..That simply won't work and a car is not a smartphone.
You also mentioned the acquisitions of BMW and VW. That would certainly make them immediately a big player but at what cost? It's an entirely different business. Further any supposed gains from "leveraging" with a supplier is most likely immaterial because BMW and VW would have already leverages their positions already.
The bottom line is, people need to stop assuming that cars have a lot of untapped savings potentials that can contribute to the bottom line. Car manufacturing is one of the most studied and engineering processes out there, is capital intensive and consume a lot of raw materials. Savings don't just appear suddenly.
michael2k - Thursday, October 29, 2015 - link
I wasn't arguing any 'untapped savings' potential. I was only arguing that Apple has the resources to immediately step up to the adult's table, bypassing the kid's table, with their size and cash reserves. Tesla, as an example, has to be careful and cautious with it's build out as they improve their cash flow. Apple has no cash flow problem and can immediately order the necessary parts, components, or designs.milkod2001 - Wednesday, October 28, 2015 - link
There is a market with hybrids (2 in 1 devices ) rising. Apple should not have a problem to re-invent its own version of Surface Pro or Book with desktop OS. That could keep Apple holding very strong for next 5-7 years. By that time they will figure out what to do next. If not they will just make less money but still be in profit.BurntMyBacon - Wednesday, October 28, 2015 - link
They are already heading this direction with the iPad Pro, so I suspect this is indeed a part of their strategy.@milkod2001: "By that time they will figure out what to do next. If not they will just make less money but still be in profit."
So many people forget this. It isn't as if the market is suddenly shrinking. It has just slowed down as typically happens with market saturation. The PC market is shrinking, yet HP, Dell, Lenovo, Asus, et al are still making plenty of money.
Michael Bay - Thursday, October 29, 2015 - link
Take Jobs out, and Apple is just another me-too. Filthy rich me-too.colonelclaw - Wednesday, October 28, 2015 - link
TVs and related services, cars/transport, and something no-one knows about yet. As a guess.lucam - Tuesday, October 27, 2015 - link
Well done...but still no iPhone 6s review yet...:(melgross - Tuesday, October 27, 2015 - link
Yeah, it's been a long time already.ciderrules - Wednesday, October 28, 2015 - link
Hopefully the long wait is because they're dong a detailed analysis of the A9 processor.boozed - Wednesday, October 28, 2015 - link
Or a review won't cause anyone who wasn't going to buy one to buy one, and vice versa?lucam - Wednesday, October 28, 2015 - link
Good question..in meantime they have done the iPad 4 mini review...Morawka - Thursday, October 29, 2015 - link
yeah they need to stop giving anandtech early review units.. save those few review units for sites that will actually review the phone within the first 3 weeks.Michael Bay - Thursday, October 29, 2015 - link
Forget iPhone, where is 960? ^_^iwod - Wednesday, October 28, 2015 - link
Apple are doing great, except their stock price hasn't moved. Compared to MS and other Tech trading at 30+ P/E. Apple is now trading at P/E 12.x and has more cash then Google + Microsoft tech reserve combined.Speedfriend - Wednesday, October 28, 2015 - link
Because they have guided to 1%-4% revenue growth in Dec quarter, despite it including the first Christmas sales for Apple Watch, iPad Pro and MacBook. And it includes an additional week over last Dec quarter. This implies that iPhone revenues are going to be down and maybe even units too, giving they are lapping the big ASP uplift. The warning a few days ago from Dialog Semi is additional evidence of iPhone stagnating. Apple is becoming a mature business in its main profit driver and that doesn't warrant a high PE.joelypolly - Wednesday, October 28, 2015 - link
And what does Google or Microsoft or even Amazon have that justifies their PE?iwod - Wednesday, October 28, 2015 - link
Exactly. They talk about Apple too rely on a single product. the iPhone. And Google has multiple product and diversify... Gmail , search, hosting..... yeah... Oh. They don't make any money at all. How do Google make money? Advertising.Microsoft..... not making more Windows license, not getting more office sales, and Its Azure cloud are making a low single digit profits while its irrelevant search engine is profitable deserve a 35 P/E named as a growth company....
id4andrei - Wednesday, October 28, 2015 - link
Both these companies have solid services that are more perennial than fickle consumerism. You're forgetting that Apple is not just a tech company selling smartphones and computers. They sell status symbol, fashion icons. Apple doesn't have retail stores, they have temples.People sell their kidneys for iphones in China; a huge scalper and smuggling market exists for it. Are you really sure they are in love with the BSD flavor of osx/ios?
michael2k - Wednesday, October 28, 2015 - link
I dunno, it sounds like you're describing Apple as the one with the less fickle product here.Google has already announced that mobile marketshare for search dwarfs desktop marketshare, for example, and Microsoft has reported that their PC licensing has fallen now in terms of revenue for several quarters.
It would appear that Apple's growing iPhone sales (and yes, they are still growing seven years later) is the stronger business model at this point than ads or OS sales. I mean, after all, if Google disrupted existing ad business then it stands to reason their own ad business isn't bulletproof, and if Google's Android disrupted Microsoft's OS licensing model then... yes, neither Android nor Windows licenses are either bulletproof.
Which means people selling their kidneys for iPhones is the best way forward. So far no one has successfully disrupted Apple.