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Apple Reports Record Fourth Quarter Results

102 points by runesoerensen 11y ago

trendnet 11y ago
iPhone gets them ~63%. iPad brings less than Mac hardware. Apple Watch is just ~4% after a year. Investors should probably be a bit worried.
- kgp7 11y ago
  > Apple Watch is just ~4% after a year The Apple Watch just went on sale this year.
- freshyill 11y ago
  If the past decade and a half of soaring profits and products that consumers love have taught me anything about Apple, it's that they're doomed.
  - btian 11y ago
    Apple is doomed. Always has been and will always be. /s
    - freshyill 11y ago
      The beleaguered Performa maker…
- matwood 11y ago
  Apple watch at ~4% in less than a year is amazing. Especially considering that most people are claiming it is an abject failure. Version 2 is typically when an Apple product hits its stride so I expect to see it grow. The iPad was great when the iPhone was small, but Apple has basically cannibalized iPads with plus size phones. The large iPad Pro will be a wait and see thing.
  - ghaff 11y ago
    There are so many interesting dynamics going on with tablets that it's really hard to read the tea leaves about where things are going. You seem to have long (in part because unsubsidized) upgrade cycles, larger phones, questions of reconvergence(?) with laptops, indirect competitors like Chromebooks in areas like education, very cheap entrants like the $50 Amazon Fire--the list goes on. I'm neither bearish nor bullish on tablets as a category simply because I find it so hard to really get my head around the space.
- Cookingboy 11y ago
  Where did you get the 4% data? If that's true then it's absurd that the watch is on track to become a TEN BILLION DOLLARS business in its first iteration. People forget that 4% of AAPL's revenue is about $10 billion.
  - josephagoss 11y ago
    It wouldn't surprise me. I remember reading last year that iTunes alone is a larger business than Yahoo. The scale of Apple is unreal.
guelo 11y ago
With that unbelievable 40% margin it seems like they could wipe out all competition by lowering their prices. I wonder if they worry that that would get them into monopoly territory and bring heavier regulation.
- samstave 11y ago
  Greed is a hell of a drug
  - aroman 11y ago
    would greed be wiping out their competitors or keeping their large margins...?
  - seivan 11y ago
    That greed made a vastly superior phone (back then) to anything on the market as it was mocked and ridiculed. Companies like (Sony) Ericsson were ridiculing it. First phone with a decent development environment, SDK and App Store.
    - samstave 11y ago
      The two can be mutually exclusive. Good phone... still greedy.
- wiremine 11y ago
  Yeah, but how would they fund the development of their self-driving electric car that will only turn left? (because, you know, it's going to be opinionated. I can just see the the Jony Ive ad now: "We rethought everything, took everything away that absolutely didn't need to be there. What we were left with was just that: left")
  - deleted 11y ago
    [deleted]
  - s73v3r 11y ago
tdkl 11y ago
While they're busy counting money, they managed to ship an iOS who stutters on their flagship phone : https://www.youtube.com/watch?v=cGCA_v4WUaI https://www.youtube.com/watch?v=cGCA_v4WUaI The performance downgrade is even worse on last years 6, 6+ and 5S, they stutter and drop frames while scrolling.
- bsaul 11y ago
  I really don't understand why you got downvoted. I am extremely worried by the latest iOS release that managed to make an iphone 6s laggier on ios 9.1 than an iphone 5 on ios 8 for an app i'm currently developping. Provided that ios 9 brings absolutely nothing fundamentaly new, and how buggy ios 9.0 was, that makes me hope really strongly that they had the interns work on that release while the good developpers were working on revamping the whole os for ios10. We all know that blackberry was still making great sales until the very last moments of its expected collapse, simply because good business managers always find a way to grab some profits in the short term eventhough things look bad in the long term.
  - tdkl 11y ago
    I'm not surprised, it's hard to break Apple bias (and I own an iPhone), also some people don't see the difference between 60 fps and less. Regarding the performance degradation, I assume it has to do with Metal. Apple said iOS9 will feature Metal as a replacement for OpenGL throughout the system for better performance. Well we didn't see any of that. The stutters have been there since Beta 1 in June.
    - bsaul 11y ago
      Oh ok, the change to metal explains it all then. Thanks.
  - jlgaddis 11y ago
    iOS 9.1 is causing major performance issues on the iPhone 6s? I assume the recommendation is to stick with 9.0.2 at this point then?
cryptoz 11y ago
Apple shipped 48 million barometers this quarter, up from 39 million in Q4 of last year.
- samstave 11y ago
  That's a good litmus
  - cryptoz 11y ago
    Mhm. You might say that the barometer shipments are a good...barometer of Apple's performance. More seriously, I'm actually interested because I'm on a mission to crowdsource atmospheric pressure data from at least 1 billion barometers, so the more Apple ships the better. Projects like PressureNet[1] and Sunshine[2] are only currently accessing a tiny portion of what's now available for weather forecasting. [1] Android: https://play.google.com/store/apps/details?id=ca.cumulonimbus.barometernetwork https://play.google.com/store/apps/details?id=ca.cumulonimbu... [2] iPhone: https://thesunshine.co/ https://thesunshine.co/
olympus 11y ago
Something important to consider is whether this beat analyst expectations or not. Your earnings could grow by 20%, but if the stock had priced in 25% growth then you'll still see your stock drop after a report. Anybody know whether this beat expectations or not? It doesn't explicitly say it in the press release. Edit: According to Fortune, looks like this was a modest beat: http://fortune.com/2015/10/27/apple-beats-expectations-stock-pops/ http://fortune.com/2015/10/27/apple-beats-expectations-stock...
- czhiddy 11y ago
  Wall Street usually has wildly unrealistic expectations for Apple, so expect this modest beat to be spun as a significant miss.
- Cookingboy 11y ago
  Well.. considering AAPL has about the same P/E as IBM/HP, which has about -10% growth, I would personally say the growth is not priced in at all. But even though it's priced as if the company is dying, analysts are still expecting it to grow 20%+. The disconnect is almost funny.
- rattray 11y ago
  Why was this downvoted? Seems like a perfectly reasonable, helpful, and certainly non-inflammatory post.
austenallred 11y ago
32% quarterly profit growth, 22% quarterly revenue growth. Good night. In case you're doing the math at home: ~$24M/hour. ~$500,000/minute. ~$6,500/second. (And an extra $200B in the bank.) Unbelievable.
- cadalac 11y ago
  Assuming $18T (static) US dept, apple can pay it in 85 years?
- supercoder 11y ago
  Apple are doomed.
  - tequila_shot 11y ago
    I'm sorry I don't get it, doomed why? Honest question.
    - stonesam92 11y ago
      It's sarcasm. Industry analysts and the media often claim that Apple is doomed, but given their earnings obviously this is far from the case.
      - TheOtherHobbes 11y ago
        They still can't fix their software. (Drag and drop is intermittently borkened in El Capitan.) And besides - what are they going to do with all that money? At some point the actual size of the cash pile becomes an irrelevance - unless they're buying countries, secretly trying to set up a private army that could take on all the world's superpowers at the same time, or running a combined FTL/anti-gravity research lab.
        cryptoz 11y ago
        > And besides - what are they going to do with all that money? The consensus seems to be that they will enter larger markets, like automobiles. Cars cost billions to research and develop and are therefore a difficult and expensive market to enter. If Apple does enter and dominate this market, that would cost them a huge amount of their cash store but would open up additional revenue streams similar or greater than they currently enjoy.
deleted 11y ago
[deleted]
aapl8888 11y ago
There are people who make under $10 an hour assembling Apple computers in California. I teach at a community college and some of my students are employed at the factory. It's interesting how Apple gets a complete pass on their wages but companies that make a fraction of Apple's profits like Walmart or McDonald's are constantly criticized for how they pay their employees.
- cgy1 11y ago
  What computers are Apple assembling in California? They assemble the Mac Pro in Texas.
  - aapl8888 11y ago
    They're assembling the iMacs there and a few others
    - r00fus 11y ago
      You mean Flextronics? http://appleinsider.com/articles/13/06/13/us-assembly-of-apples-new-mac-pro-to-be-handled-by-flextronics---report http://appleinsider.com/articles/13/06/13/us-assembly-of-app...
  - kalleboo 11y ago
    Looks like this has been going on for a while http://techcrunch.com/2012/12/03/the-new-imac-designed-by-apple-in-california-assembled-in-usa/ http://techcrunch.com/2012/12/03/the-new-imac-designed-by-ap...
- urda 11y ago
  1) They don't have to work there* 2) If they are more qualified for a higher paying position or different job, they should move to it. Apple doesn't owe them anything, and it certainly doesn't need people attempting to tell Apple how to pay their employees. If you don't like it, move to another group, end of story. Edits to be nicer and clearer
  - 11y ago
myth_buster 11y ago
The importance of lifestyle branding! A lot of the iPhone sale could be attributed to the Rose Gold 6s. leaving the world better than we found it. Good Grief! Edit: Did I hit a nerve or what!
LiweiZ 11y ago
Apple is leveraging its established ground to pursue more profit. This requires operation excellence. However, to win in the future, it needs products like what Jobs delivered. Based on the products Apple offered in the post-Jobs era so far, Apple has not shown any sign to provide a product that really shines as a whole. Even though I am a big fan of Apple, this makes me wonder its future. edit: typo
- arjunrc 11y ago
  I think about this a lot, but I can't come up with a single product that has an average selling price of over $600, that pretty much EVERYONE (at least adults) in the world would need, that they would also want to upgrade every two years. The Watch would be this device as long as its gets more independent of the phone. Maybe a car in the future! But in the near term, I would imagine their growth would taper off as more and more of the developing world get an iPhone (China still has few more years of growth) & Moore's law means features aren't added as often.
  - r00fus 11y ago
    > But in the near term, I would imagine their growth would taper off as more and more of the developing world get an iPhone (China still has few more years of growth) & Moore's law means features aren't added as often. Apple has enough in the bank to make a strategic shift or leap into another market when that starts to happens (who knows what they haven't released that they've been prototyping for years).
    - arjunrc 11y ago
      I hope so! I mean what would buy apart from a phone and a watch (& a car) thats worth more than $500? Smart Shoes? :)
    - deleted 11y ago
      [deleted]
    - LiweiZ 11y ago
      The problem is not about resources. It's about the organization's product-oriented DNA and its familiarity to the field it works on. I hope Apple could show us some more polished products so that as someone who works on iOS could see a clearer and brighter future.
hagope 11y ago
Eventually people will realize how grossly overpriced their iPhone is and the party will slowly come to an end... There are so many great alternatives at much lower cost.
zaroth 11y ago
I love the profits that this industry can bring, that much is amazing. Deploying that capital, like on R&D and acquisition is Apple's bigger problem now. The dividend is not bad either! With the added competition from Microsoft, I'm sure they will be pushing even harder for the next release. I am hoping a recent down-trend will be well reverse via software updates to come, apparently the phones need some more optimization? But also nice to see competition on features, form factor, power, display size... seems like some really good Surface products and I'm not following Apple as closely I guess. The market has no idea how to value it. Which should mean a huge opportunity for someone who does? (I wonder if 10 hours late this can get any responses)

102 points by runesoerensen 11y ago

iPhone gets them ~63%. iPad brings less than Mac hardware. Apple Watch is just ~4% after a year. Investors should probably be a bit worried.

kgp7 11y ago
> Apple Watch is just ~4% after a year The Apple Watch just went on sale this year.
freshyill 11y ago
If the past decade and a half of soaring profits and products that consumers love have taught me anything about Apple, it's that they're doomed.
- btian 11y ago
  Apple is doomed. Always has been and will always be. /s
  - freshyill 11y ago
    The beleaguered Performa maker…
matwood 11y ago
Apple watch at ~4% in less than a year is amazing. Especially considering that most people are claiming it is an abject failure. Version 2 is typically when an Apple product hits its stride so I expect to see it grow. The iPad was great when the iPhone was small, but Apple has basically cannibalized iPads with plus size phones. The large iPad Pro will be a wait and see thing.
- ghaff 11y ago
  There are so many interesting dynamics going on with tablets that it's really hard to read the tea leaves about where things are going. You seem to have long (in part because unsubsidized) upgrade cycles, larger phones, questions of reconvergence(?) with laptops, indirect competitors like Chromebooks in areas like education, very cheap entrants like the $50 Amazon Fire--the list goes on. I'm neither bearish nor bullish on tablets as a category simply because I find it so hard to really get my head around the space.
Cookingboy 11y ago
Where did you get the 4% data? If that's true then it's absurd that the watch is on track to become a TEN BILLION DOLLARS business in its first iteration. People forget that 4% of AAPL's revenue is about $10 billion.
- josephagoss 11y ago
  It wouldn't surprise me. I remember reading last year that iTunes alone is a larger business than Yahoo. The scale of Apple is unreal.

guelo 11y ago

With that unbelievable 40% margin it seems like they could wipe out all competition by lowering their prices. I wonder if they worry that that would get them into monopoly territory and bring heavier regulation.

samstave 11y ago
Greed is a hell of a drug
- aroman 11y ago
  would greed be wiping out their competitors or keeping their large margins...?
- seivan 11y ago
  That greed made a vastly superior phone (back then) to anything on the market as it was mocked and ridiculed. Companies like (Sony) Ericsson were ridiculing it. First phone with a decent development environment, SDK and App Store.
  - samstave 11y ago
    The two can be mutually exclusive. Good phone... still greedy.
wiremine 11y ago
Yeah, but how would they fund the development of their self-driving electric car that will only turn left? (because, you know, it's going to be opinionated. I can just see the the Jony Ive ad now: "We rethought everything, took everything away that absolutely didn't need to be there. What we were left with was just that: left")
- deleted 11y ago
  [deleted]
- s73v3r 11y ago

tdkl 11y ago

While they're busy counting money, they managed to ship an iOS who stutters on their flagship phone : https://www.youtube.com/watch?v=cGCA_v4WUaI https://www.youtube.com/watch?v=cGCA_v4WUaI The performance downgrade is even worse on last years 6, 6+ and 5S, they stutter and drop frames while scrolling.

bsaul 11y ago
I really don't understand why you got downvoted. I am extremely worried by the latest iOS release that managed to make an iphone 6s laggier on ios 9.1 than an iphone 5 on ios 8 for an app i'm currently developping. Provided that ios 9 brings absolutely nothing fundamentaly new, and how buggy ios 9.0 was, that makes me hope really strongly that they had the interns work on that release while the good developpers were working on revamping the whole os for ios10. We all know that blackberry was still making great sales until the very last moments of its expected collapse, simply because good business managers always find a way to grab some profits in the short term eventhough things look bad in the long term.
- tdkl 11y ago
  I'm not surprised, it's hard to break Apple bias (and I own an iPhone), also some people don't see the difference between 60 fps and less. Regarding the performance degradation, I assume it has to do with Metal. Apple said iOS9 will feature Metal as a replacement for OpenGL throughout the system for better performance. Well we didn't see any of that. The stutters have been there since Beta 1 in June.
  - bsaul 11y ago
    Oh ok, the change to metal explains it all then. Thanks.
- jlgaddis 11y ago
  iOS 9.1 is causing major performance issues on the iPhone 6s? I assume the recommendation is to stick with 9.0.2 at this point then?

cryptoz 11y ago

Apple shipped 48 million barometers this quarter, up from 39 million in Q4 of last year.

samstave 11y ago
That's a good litmus
- cryptoz 11y ago
  Mhm. You might say that the barometer shipments are a good...barometer of Apple's performance. More seriously, I'm actually interested because I'm on a mission to crowdsource atmospheric pressure data from at least 1 billion barometers, so the more Apple ships the better. Projects like PressureNet[1] and Sunshine[2] are only currently accessing a tiny portion of what's now available for weather forecasting. [1] Android: https://play.google.com/store/apps/details?id=ca.cumulonimbus.barometernetwork https://play.google.com/store/apps/details?id=ca.cumulonimbu... [2] iPhone: https://thesunshine.co/ https://thesunshine.co/

olympus 11y ago

Something important to consider is whether this beat analyst expectations or not. Your earnings could grow by 20%, but if the stock had priced in 25% growth then you'll still see your stock drop after a report. Anybody know whether this beat expectations or not? It doesn't explicitly say it in the press release. Edit: According to Fortune, looks like this was a modest beat: http://fortune.com/2015/10/27/apple-beats-expectations-stock-pops/ http://fortune.com/2015/10/27/apple-beats-expectations-stock...

czhiddy 11y ago
Wall Street usually has wildly unrealistic expectations for Apple, so expect this modest beat to be spun as a significant miss.
Cookingboy 11y ago
Well.. considering AAPL has about the same P/E as IBM/HP, which has about -10% growth, I would personally say the growth is not priced in at all. But even though it's priced as if the company is dying, analysts are still expecting it to grow 20%+. The disconnect is almost funny.
rattray 11y ago
Why was this downvoted? Seems like a perfectly reasonable, helpful, and certainly non-inflammatory post.

austenallred 11y ago

32% quarterly profit growth, 22% quarterly revenue growth. Good night. In case you're doing the math at home: ~$24M/hour. ~$500,000/minute. ~$6,500/second. (And an extra $200B in the bank.) Unbelievable.

cadalac 11y ago
Assuming $18T (static) US dept, apple can pay it in 85 years?
supercoder 11y ago
Apple are doomed.
- tequila_shot 11y ago
  I'm sorry I don't get it, doomed why? Honest question.
  - stonesam92 11y ago
    It's sarcasm. Industry analysts and the media often claim that Apple is doomed, but given their earnings obviously this is far from the case.
    - TheOtherHobbes 11y ago
      They still can't fix their software. (Drag and drop is intermittently borkened in El Capitan.) And besides - what are they going to do with all that money? At some point the actual size of the cash pile becomes an irrelevance - unless they're buying countries, secretly trying to set up a private army that could take on all the world's superpowers at the same time, or running a combined FTL/anti-gravity research lab.
      - cryptoz 11y ago
        > And besides - what are they going to do with all that money? The consensus seems to be that they will enter larger markets, like automobiles. Cars cost billions to research and develop and are therefore a difficult and expensive market to enter. If Apple does enter and dominate this market, that would cost them a huge amount of their cash store but would open up additional revenue streams similar or greater than they currently enjoy.

deleted 11y ago

[deleted]

aapl8888 11y ago

There are people who make under $10 an hour assembling Apple computers in California. I teach at a community college and some of my students are employed at the factory. It's interesting how Apple gets a complete pass on their wages but companies that make a fraction of Apple's profits like Walmart or McDonald's are constantly criticized for how they pay their employees.

cgy1 11y ago
What computers are Apple assembling in California? They assemble the Mac Pro in Texas.
- aapl8888 11y ago
  They're assembling the iMacs there and a few others
  - r00fus 11y ago
    You mean Flextronics? http://appleinsider.com/articles/13/06/13/us-assembly-of-apples-new-mac-pro-to-be-handled-by-flextronics---report http://appleinsider.com/articles/13/06/13/us-assembly-of-app...
- kalleboo 11y ago
  Looks like this has been going on for a while http://techcrunch.com/2012/12/03/the-new-imac-designed-by-apple-in-california-assembled-in-usa/ http://techcrunch.com/2012/12/03/the-new-imac-designed-by-ap...
urda 11y ago
1) They don't have to work there* 2) If they are more qualified for a higher paying position or different job, they should move to it. Apple doesn't owe them anything, and it certainly doesn't need people attempting to tell Apple how to pay their employees. If you don't like it, move to another group, end of story. Edits to be nicer and clearer
- 11y ago

myth_buster 11y ago

The importance of lifestyle branding! A lot of the iPhone sale could be attributed to the Rose Gold 6s. leaving the world better than we found it. Good Grief! Edit: Did I hit a nerve or what!

LiweiZ 11y ago

Apple is leveraging its established ground to pursue more profit. This requires operation excellence. However, to win in the future, it needs products like what Jobs delivered. Based on the products Apple offered in the post-Jobs era so far, Apple has not shown any sign to provide a product that really shines as a whole. Even though I am a big fan of Apple, this makes me wonder its future. edit: typo

arjunrc 11y ago
I think about this a lot, but I can't come up with a single product that has an average selling price of over $600, that pretty much EVERYONE (at least adults) in the world would need, that they would also want to upgrade every two years. The Watch would be this device as long as its gets more independent of the phone. Maybe a car in the future! But in the near term, I would imagine their growth would taper off as more and more of the developing world get an iPhone (China still has few more years of growth) & Moore's law means features aren't added as often.
- r00fus 11y ago
  > But in the near term, I would imagine their growth would taper off as more and more of the developing world get an iPhone (China still has few more years of growth) & Moore's law means features aren't added as often. Apple has enough in the bank to make a strategic shift or leap into another market when that starts to happens (who knows what they haven't released that they've been prototyping for years).
  - arjunrc 11y ago
    I hope so! I mean what would buy apart from a phone and a watch (& a car) thats worth more than $500? Smart Shoes? :)
  - deleted 11y ago
    [deleted]
  - LiweiZ 11y ago
    The problem is not about resources. It's about the organization's product-oriented DNA and its familiarity to the field it works on. I hope Apple could show us some more polished products so that as someone who works on iOS could see a clearer and brighter future.

hagope 11y ago

Eventually people will realize how grossly overpriced their iPhone is and the party will slowly come to an end... There are so many great alternatives at much lower cost.

zaroth 11y ago

I love the profits that this industry can bring, that much is amazing. Deploying that capital, like on R&D and acquisition is Apple's bigger problem now. The dividend is not bad either! With the added competition from Microsoft, I'm sure they will be pushing even harder for the next release. I am hoping a recent down-trend will be well reverse via software updates to come, apparently the phones need some more optimization? But also nice to see competition on features, form factor, power, display size... seems like some really good Surface products and I'm not following Apple as closely I guess. The market has no idea how to value it. Which should mean a huge opportunity for someone who does? (I wonder if 10 hours late this can get any responses)