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Apple Reports Record First Quarter Results, Slowing Growth in iPhone Sales

132 points by davidbarker 11y ago

deleted 11y ago
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- eps 11y ago
  Perhaps just do (another) Show HN instead of trying to piggy-back on a largely unrelated topic?
FreedomToCreate 11y ago
Its absolutely incredible how year after year, Apple convinces people to continually upgrade their devices, as well as drive new customers to there business. An important metric to note from there release however is that 66% of sales came from international markets.
- verandaguy 11y ago
  Definitely; if this whole thing goes under one day, it'll at least have been a tremendous learning experience for the industry.
- tinkerrr 11y ago
  That important metric actually understates their sales due to the strength of the US Dollar this last year. On a constant-currency basis, it is about 15% higher. Just goes to show the 'real' results are even more impressive.
  - forgetsusername 11y ago
    >That important metric actually understates their sales due to the strength of the US Dollar this last year. Maybe sales were over-stated in the decade prior due to weakness in the US dollar? I don't understand the meaning of picking a favourable exchange rate to normalize the earnings. For all we know, it's high dollar from here to eternity.
- sjwright 11y ago
  And nobody upgrades Windows computers or Android phones? Where is the evidence that Apple product owners upgrade more frequently?
  - wanda 11y ago
    I believe FreedomToCreate was expressing surprise not only at the frequency with which Apple customers upgrade their gear, but rather the fact that such expensive hardware should be upgraded so frequently at all when the advantages are incremental. The reason for this is that, while Apple gets incrementally better, it at least does not tend to get worse. Compare with Windows 10. Superficially, Apple tech is also a status symbol, especially among the young--but that is not to say that the cool kids do not buy Android phones, Kindles or Chromebooks. Less superficially, the target market of Apple is the luxury/privileged--and this segment of society does not consider advantages of upgrading and neither do they consider cost. It is the same segment of society (or at least significantly overlaps with the same segment) that will order avant-garde splats of "exotic modern art" food for exorbitant prices where others would consider frugality or nutritional benefit. It is the same market that all marketing targets: the clueless and impressionable. I am not saying Apple devices are bad, I am saying they are heavily marked up far beyond the value that OS X and its exclusive applications add, and ergo the majority of its buyers are sufficiently well-off that they can afford to have the most fashionable computer. There is very little fashionable about having something from the previous season, let alone 2012 (despite the fact that a MBP from this year will probably still be sufficient for a web developer in a typical situation). Of course, I am going to get lambasted if I do not also mention that OS X is (arguably) well-designed in terms of user interface. I say arguably because, personally, I do not see this glistening advantage--but I'm a developer, I want a command line and a modern web browser. What I do see is more effort put into the actual polish of the UI than Microsoft seems to invest in their OS. It's no different to Chrome vs Firefox. Chrome is building up quite an impressive market share, despite the fact that its peers (excluding IE, as always, because apparently implementing the flexible box model was too difficult) can do most of the same things that Chrome can do. In a similar vein, Chromium (FOSS Chrome) is readily available to use (yes, yes, dev builds, but they are remarkably stable and I've yet to experience an issue with a Chromium dev build) yet nobody uses it. While obviously discoverability is an issue (since Chromium does not advertise that it can be easily installed) I imagine that if you offered Apple hardware at a lower price without branding, it would sit in the branded Apple hardware's shadow. Especially given the angst already present among cool kids about phones which seem to imitate the iPhone's physical product design) Well, this has been thoroughly anecdotal and I don't usually like to do that, but hey ho. If it's of value for someone to read and expand upon or criticise, why not post it
- duaneb 11y ago
  Is it incredible? Do their competitors have systemic problems getting their customers to upgrade? I don't see that. If anything, I still see plenty of iPhone 4s and 5c models and content customers.
  - billiam 11y ago
    Are you kidding? I think Apple has definitely proven it understands the upgrade cycle for products better than anyone--they perfectly the mid-cycle upgrade that the phone companies invented in the early 2000s (that's the S line), while doing what Motorola, Samsung, etc never could--consistently reduce hardware BOM by ~50% per generation. They nailed the product planning, they just missed the collapse of oil and the high dollar.
    - duaneb 11y ago
      You can call it perfect, but it doesn't mean it's so. What kind of numbers are you seeing on upgrades that "proves" they're having some kind of special activity here?
      - lostlogin 11y ago
        $74 billion convinced me.
        duaneb 11y ago
        That's a revenue number. It does not indicate any type of characteristic about the behavior of the individual customers.
- digi_owl 11y ago
  Somehow Jobs was able to turn the brand into a fashion item, up there with certain watches etc, back during the iPod. Then again i can't help but wonder if he got help by Apple computers being a de-facto standard in media production. I seem to recall that the first time i heard about iPod was because some artist or actor was seen with some white wires dangling from his ears. And that was back when you needed a Firewire card and third party software to get it working on anything but a Mac. And as best i recall it was not in the tech section or some such.
  - erikpukinskis 11y ago
    I don't understand why design-focus isn't enough of an explanation for Apple's success. Sell the most powerful product humanity has ever seen (the computer) and put human factors at the heart of the product process. That's it. No one else did that. Every other computer company allowed other motivations to trump human factors. These days it's standard practice... although, few people know how to tell a good designer from a bad one, so they hire bad ones who do crap work and the institution never really trusts them and project managers end up running the show, mostly by allowing powerful employees to put their pork barrel projects on the schedule. Steve Jobs could tell good designers from bad ones, he provided a wall of protection and power around them, and he fought like hell to keep the company solvent until the rest of the organization started to trust them. That's why they have devices people want to re-purchase year after year.
    - arrrg 11y ago
      I do think it’s fashion, but it’s fashion combined with technical depth and sophistication. Usually technology that’s just plain stylish (instead of, say, kitschy or flashy) tends to be technologically quite poor, especially when it comes to software, but also when it comes to component quality. Apple manages to provide a complete and round packet. Sure, some aspects are better or more pronounced than others, but it’s not very uneven.
bby 11y ago
below expectations
deleted 11y ago
[deleted]
- sjwright 11y ago
  They provided the comparison to last year in the opening paragraph of their press release. I don't understand what value you're adding.
  - mgraczyk 11y ago
    The point is that although they posted a record quarter, it is hardly better than 1 year ago. Their revenue one year ago was substantially higher than 2 years ago.
  - deleted 11y ago
    [deleted]
    - sjwright 11y ago
      I don't think "flattening off" is an assertion you can make with just three numbers.
      - jeffjose 11y ago
        This. Its the growth trend that's flattening, which should be worrisome to investors if you ask me.
- phinnaeus 11y ago
  You know, they compare it to last year in that same sentence.
Steko 11y ago
Big news is Apple finally feeling effects of weakness in China and the collapse of demand in oil dependent places like Canada.
- jbverschoor 11y ago
  weakness of the chinese currency
  - jonknee 11y ago
    No, weakness in demand as well. > Luca Maestri, Apple’s chief financial officer, said the company is feeling the effects of a "very different" economic environment around the world. Apple is beginning to see "softness" in China, particularly in Hong Kong, he said. http://www.bloomberg.com/news/articles/2016-01-26/apple-forecasts-first-sales-drop-since-2003-on-iphone-slowdown http://www.bloomberg.com/news/articles/2016-01-26/apple-fore...
  - Steko 11y ago
    Weakness of the Yuan affects the revenue number by the size of the China market but shouldn't by itself impact the raw number of phones sold (Apple pays for the phones parts and labor mostly with Yuan).
    - simonh 11y ago
      The cost of assembly is tiny compared to the cost of the parts, which largely come from Korea, Japan and for some of the SOCs and glass the US.
    - Steko 11y ago
      Oops most of the contracts for components are apparently enumerated in dollars.
- nemo44x 11y ago
  That's the part that scares me a bit. Not for Apple's sake but as a confirmation of the general global economic slowdown we are likely in right now. The recovery has hit a bump it might appear.
pavlov 11y ago
Superficially it looks like revenue growth has slowed down quite a bit. But the Reuters article mentions that "the strong U.S. dollar ... knocked about $5 billion off the company's revenue": https://finance.yahoo.com/news/apple-sells-fewer-iphones-expected-215513644.html https://finance.yahoo.com/news/apple-sells-fewer-iphones-exp... That makes quite a difference (and illustrates that it can be pretty hard to figure out growth numbers for a multinational corporation, even one that has a super-simple product line like Apple's).
- TazeTSchnitzel 11y ago
  Consider the supplemental material: http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pdf http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pd... Year on year revenue was only up 2%, but look at the "in constant currency" section. If there was no currency change, it would have been up 8%.
- guelo 11y ago
  It's actually pretty easy, count units sold. They sold 74.779 million iPhones this holiday quarter and 74.468 million last year. Basically the same number. It shows that sales growth has stopped after a decade of hyper growth. It's still a heck of a lot of phones though.
  - ricksplat 11y ago
    It's the same number, but I think the cost of units has gone up year on year too - though that could just be the dismal Euro ...
    - tempestn 11y ago
      In terms of USD the cost has gone down slightly, which can also be seen by comparing the sales numbers to the revenue.
  - snowwrestler 11y ago
    It's pretty hard to analyze a decade-long trend by just comparing the 2 most recent years. It could be that growth has stopped, or it could be that growth is continuing, but that 2015 was an outlier. We won't actually know until next year.
dmix 11y ago
Just yesterday I read an NYTimes article announcing how Apple is beyond their growth phase. > Investors have long relied on Apple to deliver one crucial attribute: growth. Now they are beginning to wonder whether Apple’s days as a growth stock are coming to an end. http://www.nytimes.com/2016/01/25/technology/looking-for-signs-that-apples-runaway-growth-is-waning.html http://www.nytimes.com/2016/01/25/technology/looking-for-sig... $74.6 billion ---> $75.9 billion is not huge but it's noteworthy they've maintained positive numbers.
- nilkn 11y ago
  They're running an article right now on slowing iPhone growth numbers: http://www.nytimes.com/2016/01/27/technology/apple-earnings-iphone-sales.html?hpw&rref=technology&action=click&pgtype=Homepage&module=well-region&region=bottom-well&WT.nav=bottom-well http://www.nytimes.com/2016/01/27/technology/apple-earnings-...
- jonknee 11y ago
  > $74.6 billion ---> $75.9 billion is not huge but it's noteworthy they've maintained positive numbers. Yes, and they just advised that the current quarter is going to be less than Q1 2015. The NYT was correct.
nemo44x 11y ago
Exchange rates are killing them. The strong USD is cutting into profits in a major way. With iPad, Mac and now iPhone showing flat (and negative) growth I would expect a fairly flat stock price for the time being. When/If the USD begins to lose value to other currencies I'd call that a good time to consider to build a position in AAPL. I don't have a position but was hoping for a big win this quarter. AAPL exemplifies a lot of the issues many companies are having because of exchange rates and I do not expect the broader market to do much better for awhile. Especially with so much foreign debt in USD, a lot of companies are going to have a hard time paying off bonds and loans, hurting their ability to grow.
- Analemma_ 11y ago
  > was hoping for a big win this quarter. The largest quarterly profit ever recorded by any company wasn't enough of a big win? I don't want to soapbox too much, but there is something deeply wrong with capitalism when you can be more profitable than any corporation that has ever existed and it seems like a letdown. > Especially with so much foreign debt in USD, a lot of companies are going to have a hard time paying off bonds and loans, hurting their ability to grow. All the tech companies that have had big bond issues recently (Apple, Microsoft, etc.) are doing it because it's literally cheaper than repatriating their actual foreign earnings to the United States. As long as those foreign earnings continue to exist, borrowing money is arguably a better way to finance their day-to-day operations, especially when interest rates don't seem likely to climb much in the intermediate future.
  - nemo44x 11y ago
    They aren't growing is the problem. But more importantly when you look at their numbers in China you can see the global slowdown. It's bad for all global companies. As for bonds, I meant by foreign companies. Many bonds have been written with USD which are now becoming painful to payoff as their own currencies are not valued well against the USD.
    - Analemma_ 11y ago
      > As for bonds, I meant by foreign companies. Ah, I'm sorry, I misunderstood your post. But even so I'm not clear on why the indebtedness of foreign companies affects Apple all that much, except that it's a signal of the health of the global economy.
kmfrk 11y ago
Any ideas how they end up at a 25.5% tax rate?
- toephu2 11y ago
  Ireland
  - Nicholas_C 11y ago
    For anyone curious: https://en.m.wikipedia.org/wiki/Double_Irish_arrangement https://en.m.wikipedia.org/wiki/Double_Irish_arrangement
- ksec 11y ago
  I think you mean 25.5% being high? Or Am i reading it wrong?
  - kmfrk 11y ago
    Yes, considering the corporate tax rate is somewhat lower. But I guess it might be a California state tax at work.
JohnTHaller 11y ago
The record results include one not so happy metric: "Apple iPhone Sales Grow at Slowest Rate Ever, Company sees revenue in current quarter declining at the steepest pace in 15 years" (From: http://www.wsj.com/articles/apple-reports-slowing-growth-in-iphone-sales-1453843920 http://www.wsj.com/articles/apple-reports-slowing-growth-in-... ) Free click-through-Google link to read: https://www.google.com/search?q=Apple+iPhone+Sales+Grow+at+Slowest+Rate+Ever https://www.google.com/search?q=Apple+iPhone+Sales+Grow+at+S... iPhone sales are basically flat from last year, growing at about 0.4%. This isn't just an Apple phenomenon either. As with desktops/laptops several years ago, and tablets over the last couple years, we're getting to the point that it doesn't make sense to upgrade your phone every year or two. As long as your phone still works and does what you need it to, anyway.
- Steko 11y ago
  It's hard to draw strong conclusions here because China's launch was bumped up 2 weeks from 2014 which put them into the September quarter (+22% growth). Granted that's only a week of prior quarter but they sold 13 million phones that week. If you move 3-4 million phones for China launch from prior quarter to holiday and suddenly growth in the holiday quarter doesn't look all that anemic (or the previous quarter as spectacular). The revenue growth for the two quarters combined is 9.2%.
- jobu 11y ago
  > we're getting to the point that it doesn't make sense to upgrade your phone every year or two The biggest reason for this (in the US at least) is the decline of 2-year mobile phone contracts over the last year. Many people are rethinking their upgrade cycle now that cellphones are a direct expense instead of being subsidized by the carrier.
  - JohnTHaller 11y ago
    Absolutely. Even though most carriers are doing something like T-Mobile is with their 2 year payoff period for phones with no interest, people see that their cell phone bill can be less each month if they don't upgrade. On the high end for the iPhone 6s Pro with 128GB ($229 up front plus $30/month for 2 years) or a Galaxy Note 5 ($0 up front plus $29/month for 2 years), people see that they can save quite a bit of money by keeping their phone longer.
thecosas 11y ago
Great coverage (via twitter) from Horace Deidu of http://asymco.com http://asymco.com: https://twitter.com/asymco https://twitter.com/asymco Some of my favorites: * https://twitter.com/asymco/status/692106160376303616 https://twitter.com/asymco/status/692106160376303616 * https://twitter.com/asymco/status/692108871012343808 https://twitter.com/asymco/status/692108871012343808 * https://twitter.com/asymco/status/692111023197798401 https://twitter.com/asymco/status/692111023197798401
chvid 11y ago
One would expect this to be due to the strong dollar but the biggest drop in revenue (dollar-wise) is in the Americas. http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pdf http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pd... Japan has the biggest in percentage drop. China and Europe are up.
XJOKOLAT 11y ago
Probably about time a slow down happened. I own a Moto G 3rd Gen. Swift, waterproof, stong-glass, bloat-free, removable battery, memory-upgradable, £150. Does the job I need it to do and, I'd imagine, the job most others need also. (I don't work for Moto, nor even remotely related to them). I've been wondering what on earth iPhone and Sammy users are doing with their £400-£600 modern icon-ophones Are people just in a trance? (This from a renowned gadget freak who used to trade in smartphones every 3 months)
- martinald 11y ago
  I'm exactly the same. I have a moto x play (mainly for the much bigger battery). £200ish when I bought it. Works great, really happy with it. I've owned every model of the iPhone (some twice for loss/damage) up until the 6. The battery life just isn't acceptable for me (i'm a heavy user, granted, but apple hasn't made any improvements in that area for a long time - whatever power savings they've done has been put into making the device thinner). And, the phone does exactly what I need for 1/3rd the cost. Plus I don't have to pay another £100+ for a decent amount of storage. I think Apple (and other high end smartphones) are going to be really stuck with this. Even if they don't switch to Android, people just aren't going to switch phones as much as they did before. They don't offer anything compelling. Same problem has happened with PC/Mac/iPad.
- simonh 11y ago
  Given the value I've got out of my iPhones I done see them as being expensive. Heck, my daughter is still using my 3GS. The length and depth of support, consistent hardware and software quality, app availability and longevity of the devices have been excellent, so I've never had any reason to switch to anything else. Every year has been touted as the time Android catches up, but it just vever happens. Having said that the most recent Galaxy's and the Moto G seem like good options. But I'm still concerned about software updates and app quality and availability. Maybe when my 3GS packs in, a Moto G or something like it might be in my daughters future, but it's just as likely she'll inherit another of our hand-me-down iPhones.
- blinkingled 11y ago
  Yeah, I would say people haven't gotten enough time to sense that a $200 phone beats the pants off of a $750 one if you consider price, battery life and what it does objectively. Just a year or so ago $200 phones could be dinged in some way or the other - bad camera, bad battery life, low durability, slower performance etc. I wonder how planned obsolescence plays into this though. If every two years your phone is going to become dog slow or is not getting updates anymore you will have to upgrade. Good old days of Windows where you could run the same hardware for 3 different OS releases and upgrade the CPU/GPU for the 4th one! :(
erikpukinskis 11y ago
It's interesting iPad sales are down 25% year over year. That continues to be the biggest shock to me about Apple's product line, although that writing has been on the wall since 2013/2014. I keep wondering when the desktop/laptop form factor is finally going to die. I thought tablets would do it but that's obviously wrong. Phones, surprisingly, seem to be continuing to eat away at the desktop use cases, which is expected, but I wasn't expecting them to be carrying the brunt of it, and there are ergonomic limits to how far that can go. VR is the obvious candidate to take out desktops. The solitary nature of desktop activities fits VR well. That's my new operating hypothesis: in 10 years it will basically be phones+VR, probably with TVs still strong. VR will eat some of TV, but it can't really compete with TV's ambient nature. AR could, and will eventually kill TV, but I am skeptical it will make a dent in the home in this decade, because that's how long it will take to get miniaturization where it needs to be for home use.
- shrewduser 11y ago
  desktops aren't going anywhere, calm your farm.
  - mandeepj 11y ago
    heavy lifting stuff gets done on desktop.
    - erikpukinskis 11y ago
      True, but actual heavy lifting work is probably <1% of the current desktop market. Most of it is browsing, messaging, documents.
      - FatalBaboon 11y ago
        So when you need to do heavy lifting, you just give up because all you got is a tablet? Besides, as far as programming goes, I'm happy I got all the power I can find to iterate quickly, and tablet != power.
      - 11y ago
venomsnake 11y ago
I am no apple fanboy ... but this is no news. They only way people could possibly consume more iPhones is if Apple grinds them to a paste and sell them as dietary supplements. Or label them as statins. Every person in the world that wants iPhone - already has one. With lack of killer apps in the last 2-3 years we are in mature market already.
- sumedh 11y ago
  > Every person in the world that wants iPhone - already has one. Well not really. India is still an untapped market although most Indians cannot afford one right now but they will in the future. Apple is going to open its exclusive stores in India this year. http://www.reuters.com/article/us-apple-india-retail-idUSKCN0UY0OX http://www.reuters.com/article/us-apple-india-retail-idUSKCN...
xyzzy4 11y ago
What Apple needs to do is intentionally make the phones buggier the longer you hold onto them.
- deleted 11y ago
  [deleted]
brooklyndude 11y ago
I'm happy with my iPhone 6 Plus. I see NO reason to buy another right now. Zero.
samstave 11y ago
I was litereally just walking down the street 5 minutes ago and this lady behind me kept saying out loud "FUCK YOU APPLE!!!" I stopped and looked at her and she had the new Macbook Air -- and she was holding the charging cord and she was pissed off because "apple changed the fucking charger AGAIN!!!" and was lamenting that the lew cable isnt a standard USB connector and she was in a lurch with no ability to charge her machine because the new cable was not compatible with anything her or her friends had on hand.
- rocky1138 11y ago
  Don't put too much weight on this data point as the loudest voices during tough Apple times are the most likely to go right out and buy iWhatever 7 the second it is release. "I think it's dumb that Apple made my $999 pair of Beats useless when they removed my headphone jack, but... iPhone 7, man, gotta have it."
  - simonh 11y ago
    Because physically removing the headphone jack from the phones in people's pockets is something Apple are going to do? Because a lightning to headphone jack adapter is not a thing that's possible?
- lostlogin 11y ago
  New MacBook Air in my hand. It's plugs match my 2011 version exactly, and also match a 2013 MacBook that's here too. Tell her to try again. I find USB fits on the third try.
ajeet_dhaliwal 11y ago
Consumers have increasingly wised up to the two year more significant hardware update (and number increment), it would be more interesting to see sales later this year when iPhone 7 is released because in 2014/2015 there were all these reports about iPhone 6 being the fastest adopted and best selling iPhone yet.
acomjean 11y ago
Apple might start having to upgrade its computers to drive sales. The Mac "Pro" is an astounding 2+ years without an upgrade (I think the imacs are faster now...). The mac mini has gone 460 days without refresh. They do refresh their notebooks more frequently and I know i-devices drive a lot of their revenue, but charging full price for last years technology has to be holding back some sales.
- jjtheblunt 11y ago
  Mac Pro models can hold far more cores, in Xeon processors, than iMac can in i7. Check benchmarks, I suggest.
  - acomjean 11y ago
    Plus Ecc memory and dual graphic cards for the pro. Bu if your software is multi-core I guess its the way to go, but if your just using 4 cores, the iMac 5k is pretty competetive if not faster[1] and significantly cheeper. [1]http://barefeats.com/imac5k.html http://barefeats.com/imac5k.html
- lostlogin 11y ago
  This may be due to Intel rather than Apple.
randomsearch 11y ago
Every product has a cycle. The iPhone is mature now. It basically does everything I need it to do. Only a radical change in what the product _is_ will make any difference from herein. Can't see it. Time to move on. The watch is still an iPhone accessory. That's going to take time to mature, and will eventually be a mass market product (or more likely the non-Apple equivalents if Apple don't figure it out). Too many technical problems for the time being, but things will improve. In the meantime, Apple desperately need their next big thing, and it seemed incredibly obvious to me even years ago that a full TV was a no-brainer. TV interfaces suck, I mean they are just _awful_, have you used a modern TV? If you don't own one, try out the controls next time you're at a friend's house. Be prepared to feel alternating waves of anger and despair. It's so so bad, if modern TVs were websites they'd have flashing GIFs and a sign saying "Welcome to our homepage!" Actually, it's worse than that. It's like using a broken flash animation over a dial-up connection with the latency of relayed semaphore. The fact that Apple _haven't_ yet launched a full TV makes me think they have completely lost the plot. Steve talked about it on many occasions, and he was absolutely spot-on (as usual) in his analysis of current products, so where the heck is it? The market is there, the disruption potential is unbelievably huge, the timing is perfect. Tim had it right when he predicted "apps" (interactive channels) would be the future of TV, but not in the ludicrous form of a mac mini intruding into my living room with cables hanging out the back of a TV, especially if it's wall-mounted. If there's one thing the consumer world does not need, it's more stupid third-party boxes plugged into the back of TVs. Modern TV UIs are utter, utter, garbage. They're the dumb phones of the contemporary consumer electronics landscape. This is exactly the type of market Apple usually walk into and completely monopolise. How on earth have they not done this yet? Who doesn't want control of the biggest screens in the house? That are increasingly going to integrate with mobiles? That connect to Games Consoles, which you could... replace. I mean, for the love of god, the potential is ludicrous, what on earth is wrong with them?
- toufka 11y ago
  It seems that Apple bet a lot on the TV in the past few release cycles, but that the cable/network execs derailed that plan. In the bay area there were a bunch of Apple TV billboards put up, only to hear within a week that Apple was "frustrated with negotiations over its TV service[1]. There seemed to have been big launch plans that were shelved when Apple couldn't pull all the content producers on board for a grand debut. Seems Apple didn't quite get their way this round, and as a result there are a lot of stale products out there. [1]http://www.businessinsider.com/apple-is-frustrated-with-its-tv-streaming-negotiations-2016-1?op=1 http://www.businessinsider.com/apple-is-frustrated-with-its-...
HSO 11y ago
Re: Declining iPad sales I think the biggest thing Apple could do here is to change their app store policies to (re-)motivate existing developers and attract new ones. Letting prospective buyers test-drive apps, upgrade pricing, and better discovery come to mind. I have both a Mini and a Pro with Pencil and I love the hardware. The software is the problem though. Few apps make use of all the possibilities; existing apps will also have to be (re)written and possibly reconceived for the different form factors. It's a good sign that Phil Schiller is overseeing the app stores now, hopefully something will change this year. Re: iPhone Here, the obvious thing to do seems to produce a new 5S-sized model. 60 percent of 5S or older install base have not upgraded? Maybe there is a reason… Also, they could always try to go "down-market" and produce a greater variety like with the iPod to take further share from Google. I don't see the end of growth in this market, by far. Re: currency effect True, stronger dollar affects revenue or unit sales (where prices have been adapted) relative to previous years. But one could also argue that the years 2009-2014 were special in that the US weakened the dollar through QE, and perhaps Apple (and other US companies) enjoyed "backwinds" then rather than "headwinds" now. It looks whiny to me to say "look ma, 100 then is only 85 now". As someone said, "if my aunt had balls, she'd be my uncle". Macro gives and macro takes. Also, the 214bn cash bandied about should be posed against the debt they took on to pay for the buybacks. So enterprise value not quite as low as suggested but I agree it's an undervalued company.
- Spooky23 11y ago
  The problem with iPad is that tablet is a tough form factor, and many users aren't big app users -- they are web and media consumers. The price point for a device that works for those users is heading south of $100, while iPad has a 3x entry price. My wife happily uses our iPad 2. I have about 3,000 users of iPad 3's at work who aren't clamor I for new stuff -- it's almost like a thin client lifecycle.
  - deleted 11y ago
    [deleted]
draw_down 11y ago
Huh, I guess they really are doomed after all.

132 points by davidbarker 11y ago

deleted 11y ago

[deleted]

eps 11y ago
Perhaps just do (another) Show HN instead of trying to piggy-back on a largely unrelated topic?

FreedomToCreate 11y ago

Its absolutely incredible how year after year, Apple convinces people to continually upgrade their devices, as well as drive new customers to there business. An important metric to note from there release however is that 66% of sales came from international markets.

verandaguy 11y ago
Definitely; if this whole thing goes under one day, it'll at least have been a tremendous learning experience for the industry.
tinkerrr 11y ago
That important metric actually understates their sales due to the strength of the US Dollar this last year. On a constant-currency basis, it is about 15% higher. Just goes to show the 'real' results are even more impressive.
- forgetsusername 11y ago
  >That important metric actually understates their sales due to the strength of the US Dollar this last year. Maybe sales were over-stated in the decade prior due to weakness in the US dollar? I don't understand the meaning of picking a favourable exchange rate to normalize the earnings. For all we know, it's high dollar from here to eternity.
sjwright 11y ago
And nobody upgrades Windows computers or Android phones? Where is the evidence that Apple product owners upgrade more frequently?
- wanda 11y ago
  I believe FreedomToCreate was expressing surprise not only at the frequency with which Apple customers upgrade their gear, but rather the fact that such expensive hardware should be upgraded so frequently at all when the advantages are incremental. The reason for this is that, while Apple gets incrementally better, it at least does not tend to get worse. Compare with Windows 10. Superficially, Apple tech is also a status symbol, especially among the young--but that is not to say that the cool kids do not buy Android phones, Kindles or Chromebooks. Less superficially, the target market of Apple is the luxury/privileged--and this segment of society does not consider advantages of upgrading and neither do they consider cost. It is the same segment of society (or at least significantly overlaps with the same segment) that will order avant-garde splats of "exotic modern art" food for exorbitant prices where others would consider frugality or nutritional benefit. It is the same market that all marketing targets: the clueless and impressionable. I am not saying Apple devices are bad, I am saying they are heavily marked up far beyond the value that OS X and its exclusive applications add, and ergo the majority of its buyers are sufficiently well-off that they can afford to have the most fashionable computer. There is very little fashionable about having something from the previous season, let alone 2012 (despite the fact that a MBP from this year will probably still be sufficient for a web developer in a typical situation). Of course, I am going to get lambasted if I do not also mention that OS X is (arguably) well-designed in terms of user interface. I say arguably because, personally, I do not see this glistening advantage--but I'm a developer, I want a command line and a modern web browser. What I do see is more effort put into the actual polish of the UI than Microsoft seems to invest in their OS. It's no different to Chrome vs Firefox. Chrome is building up quite an impressive market share, despite the fact that its peers (excluding IE, as always, because apparently implementing the flexible box model was too difficult) can do most of the same things that Chrome can do. In a similar vein, Chromium (FOSS Chrome) is readily available to use (yes, yes, dev builds, but they are remarkably stable and I've yet to experience an issue with a Chromium dev build) yet nobody uses it. While obviously discoverability is an issue (since Chromium does not advertise that it can be easily installed) I imagine that if you offered Apple hardware at a lower price without branding, it would sit in the branded Apple hardware's shadow. Especially given the angst already present among cool kids about phones which seem to imitate the iPhone's physical product design) Well, this has been thoroughly anecdotal and I don't usually like to do that, but hey ho. If it's of value for someone to read and expand upon or criticise, why not post it
duaneb 11y ago
Is it incredible? Do their competitors have systemic problems getting their customers to upgrade? I don't see that. If anything, I still see plenty of iPhone 4s and 5c models and content customers.
- billiam 11y ago
  Are you kidding? I think Apple has definitely proven it understands the upgrade cycle for products better than anyone--they perfectly the mid-cycle upgrade that the phone companies invented in the early 2000s (that's the S line), while doing what Motorola, Samsung, etc never could--consistently reduce hardware BOM by ~50% per generation. They nailed the product planning, they just missed the collapse of oil and the high dollar.
  - duaneb 11y ago
    You can call it perfect, but it doesn't mean it's so. What kind of numbers are you seeing on upgrades that "proves" they're having some kind of special activity here?
    - lostlogin 11y ago
      $74 billion convinced me.
      - duaneb 11y ago
        That's a revenue number. It does not indicate any type of characteristic about the behavior of the individual customers.
digi_owl 11y ago
Somehow Jobs was able to turn the brand into a fashion item, up there with certain watches etc, back during the iPod. Then again i can't help but wonder if he got help by Apple computers being a de-facto standard in media production. I seem to recall that the first time i heard about iPod was because some artist or actor was seen with some white wires dangling from his ears. And that was back when you needed a Firewire card and third party software to get it working on anything but a Mac. And as best i recall it was not in the tech section or some such.
- erikpukinskis 11y ago
  I don't understand why design-focus isn't enough of an explanation for Apple's success. Sell the most powerful product humanity has ever seen (the computer) and put human factors at the heart of the product process. That's it. No one else did that. Every other computer company allowed other motivations to trump human factors. These days it's standard practice... although, few people know how to tell a good designer from a bad one, so they hire bad ones who do crap work and the institution never really trusts them and project managers end up running the show, mostly by allowing powerful employees to put their pork barrel projects on the schedule. Steve Jobs could tell good designers from bad ones, he provided a wall of protection and power around them, and he fought like hell to keep the company solvent until the rest of the organization started to trust them. That's why they have devices people want to re-purchase year after year.
  - arrrg 11y ago
    I do think it’s fashion, but it’s fashion combined with technical depth and sophistication. Usually technology that’s just plain stylish (instead of, say, kitschy or flashy) tends to be technologically quite poor, especially when it comes to software, but also when it comes to component quality. Apple manages to provide a complete and round packet. Sure, some aspects are better or more pronounced than others, but it’s not very uneven.

bby 11y ago

below expectations

deleted 11y ago

[deleted]

sjwright 11y ago
They provided the comparison to last year in the opening paragraph of their press release. I don't understand what value you're adding.
- mgraczyk 11y ago
  The point is that although they posted a record quarter, it is hardly better than 1 year ago. Their revenue one year ago was substantially higher than 2 years ago.
- deleted 11y ago
  [deleted]
  - sjwright 11y ago
    I don't think "flattening off" is an assertion you can make with just three numbers.
    - jeffjose 11y ago
      This. Its the growth trend that's flattening, which should be worrisome to investors if you ask me.
phinnaeus 11y ago
You know, they compare it to last year in that same sentence.

Steko 11y ago

Big news is Apple finally feeling effects of weakness in China and the collapse of demand in oil dependent places like Canada.

jbverschoor 11y ago
weakness of the chinese currency
- jonknee 11y ago
  No, weakness in demand as well. > Luca Maestri, Apple’s chief financial officer, said the company is feeling the effects of a "very different" economic environment around the world. Apple is beginning to see "softness" in China, particularly in Hong Kong, he said. http://www.bloomberg.com/news/articles/2016-01-26/apple-forecasts-first-sales-drop-since-2003-on-iphone-slowdown http://www.bloomberg.com/news/articles/2016-01-26/apple-fore...
- Steko 11y ago
  Weakness of the Yuan affects the revenue number by the size of the China market but shouldn't by itself impact the raw number of phones sold (Apple pays for the phones parts and labor mostly with Yuan).
  - simonh 11y ago
    The cost of assembly is tiny compared to the cost of the parts, which largely come from Korea, Japan and for some of the SOCs and glass the US.
  - Steko 11y ago
    Oops most of the contracts for components are apparently enumerated in dollars.
nemo44x 11y ago
That's the part that scares me a bit. Not for Apple's sake but as a confirmation of the general global economic slowdown we are likely in right now. The recovery has hit a bump it might appear.

pavlov 11y ago

Superficially it looks like revenue growth has slowed down quite a bit. But the Reuters article mentions that "the strong U.S. dollar ... knocked about $5 billion off the company's revenue": https://finance.yahoo.com/news/apple-sells-fewer-iphones-expected-215513644.html https://finance.yahoo.com/news/apple-sells-fewer-iphones-exp... That makes quite a difference (and illustrates that it can be pretty hard to figure out growth numbers for a multinational corporation, even one that has a super-simple product line like Apple's).

TazeTSchnitzel 11y ago
Consider the supplemental material: http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pdf http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pd... Year on year revenue was only up 2%, but look at the "in constant currency" section. If there was no currency change, it would have been up 8%.
guelo 11y ago
It's actually pretty easy, count units sold. They sold 74.779 million iPhones this holiday quarter and 74.468 million last year. Basically the same number. It shows that sales growth has stopped after a decade of hyper growth. It's still a heck of a lot of phones though.
- ricksplat 11y ago
  It's the same number, but I think the cost of units has gone up year on year too - though that could just be the dismal Euro ...
  - tempestn 11y ago
    In terms of USD the cost has gone down slightly, which can also be seen by comparing the sales numbers to the revenue.
- snowwrestler 11y ago
  It's pretty hard to analyze a decade-long trend by just comparing the 2 most recent years. It could be that growth has stopped, or it could be that growth is continuing, but that 2015 was an outlier. We won't actually know until next year.

dmix 11y ago

Just yesterday I read an NYTimes article announcing how Apple is beyond their growth phase. > Investors have long relied on Apple to deliver one crucial attribute: growth. Now they are beginning to wonder whether Apple’s days as a growth stock are coming to an end. http://www.nytimes.com/2016/01/25/technology/looking-for-signs-that-apples-runaway-growth-is-waning.html http://www.nytimes.com/2016/01/25/technology/looking-for-sig... $74.6 billion ---> $75.9 billion is not huge but it's noteworthy they've maintained positive numbers.

nilkn 11y ago
They're running an article right now on slowing iPhone growth numbers: http://www.nytimes.com/2016/01/27/technology/apple-earnings-iphone-sales.html?hpw&rref=technology&action=click&pgtype=Homepage&module=well-region&region=bottom-well&WT.nav=bottom-well http://www.nytimes.com/2016/01/27/technology/apple-earnings-...
jonknee 11y ago
> $74.6 billion ---> $75.9 billion is not huge but it's noteworthy they've maintained positive numbers. Yes, and they just advised that the current quarter is going to be less than Q1 2015. The NYT was correct.

nemo44x 11y ago

Exchange rates are killing them. The strong USD is cutting into profits in a major way. With iPad, Mac and now iPhone showing flat (and negative) growth I would expect a fairly flat stock price for the time being. When/If the USD begins to lose value to other currencies I'd call that a good time to consider to build a position in AAPL. I don't have a position but was hoping for a big win this quarter. AAPL exemplifies a lot of the issues many companies are having because of exchange rates and I do not expect the broader market to do much better for awhile. Especially with so much foreign debt in USD, a lot of companies are going to have a hard time paying off bonds and loans, hurting their ability to grow.

Analemma_ 11y ago
> was hoping for a big win this quarter. The largest quarterly profit ever recorded by any company wasn't enough of a big win? I don't want to soapbox too much, but there is something deeply wrong with capitalism when you can be more profitable than any corporation that has ever existed and it seems like a letdown. > Especially with so much foreign debt in USD, a lot of companies are going to have a hard time paying off bonds and loans, hurting their ability to grow. All the tech companies that have had big bond issues recently (Apple, Microsoft, etc.) are doing it because it's literally cheaper than repatriating their actual foreign earnings to the United States. As long as those foreign earnings continue to exist, borrowing money is arguably a better way to finance their day-to-day operations, especially when interest rates don't seem likely to climb much in the intermediate future.
- nemo44x 11y ago
  They aren't growing is the problem. But more importantly when you look at their numbers in China you can see the global slowdown. It's bad for all global companies. As for bonds, I meant by foreign companies. Many bonds have been written with USD which are now becoming painful to payoff as their own currencies are not valued well against the USD.
  - Analemma_ 11y ago
    > As for bonds, I meant by foreign companies. Ah, I'm sorry, I misunderstood your post. But even so I'm not clear on why the indebtedness of foreign companies affects Apple all that much, except that it's a signal of the health of the global economy.

kmfrk 11y ago

Any ideas how they end up at a 25.5% tax rate?

toephu2 11y ago
Ireland
- Nicholas_C 11y ago
  For anyone curious: https://en.m.wikipedia.org/wiki/Double_Irish_arrangement https://en.m.wikipedia.org/wiki/Double_Irish_arrangement
ksec 11y ago
I think you mean 25.5% being high? Or Am i reading it wrong?
- kmfrk 11y ago
  Yes, considering the corporate tax rate is somewhat lower. But I guess it might be a California state tax at work.

JohnTHaller 11y ago

The record results include one not so happy metric: "Apple iPhone Sales Grow at Slowest Rate Ever, Company sees revenue in current quarter declining at the steepest pace in 15 years" (From: http://www.wsj.com/articles/apple-reports-slowing-growth-in-iphone-sales-1453843920 http://www.wsj.com/articles/apple-reports-slowing-growth-in-... ) Free click-through-Google link to read: https://www.google.com/search?q=Apple+iPhone+Sales+Grow+at+Slowest+Rate+Ever https://www.google.com/search?q=Apple+iPhone+Sales+Grow+at+S... iPhone sales are basically flat from last year, growing at about 0.4%. This isn't just an Apple phenomenon either. As with desktops/laptops several years ago, and tablets over the last couple years, we're getting to the point that it doesn't make sense to upgrade your phone every year or two. As long as your phone still works and does what you need it to, anyway.

Steko 11y ago
It's hard to draw strong conclusions here because China's launch was bumped up 2 weeks from 2014 which put them into the September quarter (+22% growth). Granted that's only a week of prior quarter but they sold 13 million phones that week. If you move 3-4 million phones for China launch from prior quarter to holiday and suddenly growth in the holiday quarter doesn't look all that anemic (or the previous quarter as spectacular). The revenue growth for the two quarters combined is 9.2%.
jobu 11y ago
> we're getting to the point that it doesn't make sense to upgrade your phone every year or two The biggest reason for this (in the US at least) is the decline of 2-year mobile phone contracts over the last year. Many people are rethinking their upgrade cycle now that cellphones are a direct expense instead of being subsidized by the carrier.
- JohnTHaller 11y ago
  Absolutely. Even though most carriers are doing something like T-Mobile is with their 2 year payoff period for phones with no interest, people see that their cell phone bill can be less each month if they don't upgrade. On the high end for the iPhone 6s Pro with 128GB ($229 up front plus $30/month for 2 years) or a Galaxy Note 5 ($0 up front plus $29/month for 2 years), people see that they can save quite a bit of money by keeping their phone longer.

thecosas 11y ago

Great coverage (via twitter) from Horace Deidu of http://asymco.com http://asymco.com: https://twitter.com/asymco https://twitter.com/asymco Some of my favorites: * https://twitter.com/asymco/status/692106160376303616 https://twitter.com/asymco/status/692106160376303616 * https://twitter.com/asymco/status/692108871012343808 https://twitter.com/asymco/status/692108871012343808 * https://twitter.com/asymco/status/692111023197798401 https://twitter.com/asymco/status/692111023197798401

chvid 11y ago

One would expect this to be due to the strong dollar but the biggest drop in revenue (dollar-wise) is in the Americas. http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pdf http://images.apple.com/pr/pdf/q1fy16supplementalmaterial.pd... Japan has the biggest in percentage drop. China and Europe are up.

XJOKOLAT 11y ago

Probably about time a slow down happened. I own a Moto G 3rd Gen. Swift, waterproof, stong-glass, bloat-free, removable battery, memory-upgradable, £150. Does the job I need it to do and, I'd imagine, the job most others need also. (I don't work for Moto, nor even remotely related to them). I've been wondering what on earth iPhone and Sammy users are doing with their £400-£600 modern icon-ophones Are people just in a trance? (This from a renowned gadget freak who used to trade in smartphones every 3 months)

martinald 11y ago
I'm exactly the same. I have a moto x play (mainly for the much bigger battery). £200ish when I bought it. Works great, really happy with it. I've owned every model of the iPhone (some twice for loss/damage) up until the 6. The battery life just isn't acceptable for me (i'm a heavy user, granted, but apple hasn't made any improvements in that area for a long time - whatever power savings they've done has been put into making the device thinner). And, the phone does exactly what I need for 1/3rd the cost. Plus I don't have to pay another £100+ for a decent amount of storage. I think Apple (and other high end smartphones) are going to be really stuck with this. Even if they don't switch to Android, people just aren't going to switch phones as much as they did before. They don't offer anything compelling. Same problem has happened with PC/Mac/iPad.
simonh 11y ago
Given the value I've got out of my iPhones I done see them as being expensive. Heck, my daughter is still using my 3GS. The length and depth of support, consistent hardware and software quality, app availability and longevity of the devices have been excellent, so I've never had any reason to switch to anything else. Every year has been touted as the time Android catches up, but it just vever happens. Having said that the most recent Galaxy's and the Moto G seem like good options. But I'm still concerned about software updates and app quality and availability. Maybe when my 3GS packs in, a Moto G or something like it might be in my daughters future, but it's just as likely she'll inherit another of our hand-me-down iPhones.
blinkingled 11y ago
Yeah, I would say people haven't gotten enough time to sense that a $200 phone beats the pants off of a $750 one if you consider price, battery life and what it does objectively. Just a year or so ago $200 phones could be dinged in some way or the other - bad camera, bad battery life, low durability, slower performance etc. I wonder how planned obsolescence plays into this though. If every two years your phone is going to become dog slow or is not getting updates anymore you will have to upgrade. Good old days of Windows where you could run the same hardware for 3 different OS releases and upgrade the CPU/GPU for the 4th one! :(

erikpukinskis 11y ago

It's interesting iPad sales are down 25% year over year. That continues to be the biggest shock to me about Apple's product line, although that writing has been on the wall since 2013/2014. I keep wondering when the desktop/laptop form factor is finally going to die. I thought tablets would do it but that's obviously wrong. Phones, surprisingly, seem to be continuing to eat away at the desktop use cases, which is expected, but I wasn't expecting them to be carrying the brunt of it, and there are ergonomic limits to how far that can go. VR is the obvious candidate to take out desktops. The solitary nature of desktop activities fits VR well. That's my new operating hypothesis: in 10 years it will basically be phones+VR, probably with TVs still strong. VR will eat some of TV, but it can't really compete with TV's ambient nature. AR could, and will eventually kill TV, but I am skeptical it will make a dent in the home in this decade, because that's how long it will take to get miniaturization where it needs to be for home use.

shrewduser 11y ago
desktops aren't going anywhere, calm your farm.
- mandeepj 11y ago
  heavy lifting stuff gets done on desktop.
  - erikpukinskis 11y ago
    True, but actual heavy lifting work is probably <1% of the current desktop market. Most of it is browsing, messaging, documents.
    - FatalBaboon 11y ago
      So when you need to do heavy lifting, you just give up because all you got is a tablet? Besides, as far as programming goes, I'm happy I got all the power I can find to iterate quickly, and tablet != power.
    - 11y ago

venomsnake 11y ago

I am no apple fanboy ... but this is no news. They only way people could possibly consume more iPhones is if Apple grinds them to a paste and sell them as dietary supplements. Or label them as statins. Every person in the world that wants iPhone - already has one. With lack of killer apps in the last 2-3 years we are in mature market already.

sumedh 11y ago
> Every person in the world that wants iPhone - already has one. Well not really. India is still an untapped market although most Indians cannot afford one right now but they will in the future. Apple is going to open its exclusive stores in India this year. http://www.reuters.com/article/us-apple-india-retail-idUSKCN0UY0OX http://www.reuters.com/article/us-apple-india-retail-idUSKCN...

xyzzy4 11y ago

What Apple needs to do is intentionally make the phones buggier the longer you hold onto them.

deleted 11y ago
[deleted]

brooklyndude 11y ago

I'm happy with my iPhone 6 Plus. I see NO reason to buy another right now. Zero.

samstave 11y ago

I was litereally just walking down the street 5 minutes ago and this lady behind me kept saying out loud "FUCK YOU APPLE!!!" I stopped and looked at her and she had the new Macbook Air -- and she was holding the charging cord and she was pissed off because "apple changed the fucking charger AGAIN!!!" and was lamenting that the lew cable isnt a standard USB connector and she was in a lurch with no ability to charge her machine because the new cable was not compatible with anything her or her friends had on hand.

rocky1138 11y ago
Don't put too much weight on this data point as the loudest voices during tough Apple times are the most likely to go right out and buy iWhatever 7 the second it is release. "I think it's dumb that Apple made my $999 pair of Beats useless when they removed my headphone jack, but... iPhone 7, man, gotta have it."
- simonh 11y ago
  Because physically removing the headphone jack from the phones in people's pockets is something Apple are going to do? Because a lightning to headphone jack adapter is not a thing that's possible?
lostlogin 11y ago
New MacBook Air in my hand. It's plugs match my 2011 version exactly, and also match a 2013 MacBook that's here too. Tell her to try again. I find USB fits on the third try.

ajeet_dhaliwal 11y ago

Consumers have increasingly wised up to the two year more significant hardware update (and number increment), it would be more interesting to see sales later this year when iPhone 7 is released because in 2014/2015 there were all these reports about iPhone 6 being the fastest adopted and best selling iPhone yet.

acomjean 11y ago

Apple might start having to upgrade its computers to drive sales. The Mac "Pro" is an astounding 2+ years without an upgrade (I think the imacs are faster now...). The mac mini has gone 460 days without refresh. They do refresh their notebooks more frequently and I know i-devices drive a lot of their revenue, but charging full price for last years technology has to be holding back some sales.

jjtheblunt 11y ago
Mac Pro models can hold far more cores, in Xeon processors, than iMac can in i7. Check benchmarks, I suggest.
- acomjean 11y ago
  Plus Ecc memory and dual graphic cards for the pro. Bu if your software is multi-core I guess its the way to go, but if your just using 4 cores, the iMac 5k is pretty competetive if not faster[1] and significantly cheeper. [1]http://barefeats.com/imac5k.html http://barefeats.com/imac5k.html
lostlogin 11y ago
This may be due to Intel rather than Apple.

randomsearch 11y ago

Every product has a cycle. The iPhone is mature now. It basically does everything I need it to do. Only a radical change in what the product _is_ will make any difference from herein. Can't see it. Time to move on. The watch is still an iPhone accessory. That's going to take time to mature, and will eventually be a mass market product (or more likely the non-Apple equivalents if Apple don't figure it out). Too many technical problems for the time being, but things will improve. In the meantime, Apple desperately need their next big thing, and it seemed incredibly obvious to me even years ago that a full TV was a no-brainer. TV interfaces suck, I mean they are just _awful_, have you used a modern TV? If you don't own one, try out the controls next time you're at a friend's house. Be prepared to feel alternating waves of anger and despair. It's so so bad, if modern TVs were websites they'd have flashing GIFs and a sign saying "Welcome to our homepage!" Actually, it's worse than that. It's like using a broken flash animation over a dial-up connection with the latency of relayed semaphore. The fact that Apple _haven't_ yet launched a full TV makes me think they have completely lost the plot. Steve talked about it on many occasions, and he was absolutely spot-on (as usual) in his analysis of current products, so where the heck is it? The market is there, the disruption potential is unbelievably huge, the timing is perfect. Tim had it right when he predicted "apps" (interactive channels) would be the future of TV, but not in the ludicrous form of a mac mini intruding into my living room with cables hanging out the back of a TV, especially if it's wall-mounted. If there's one thing the consumer world does not need, it's more stupid third-party boxes plugged into the back of TVs. Modern TV UIs are utter, utter, garbage. They're the dumb phones of the contemporary consumer electronics landscape. This is exactly the type of market Apple usually walk into and completely monopolise. How on earth have they not done this yet? Who doesn't want control of the biggest screens in the house? That are increasingly going to integrate with mobiles? That connect to Games Consoles, which you could... replace. I mean, for the love of god, the potential is ludicrous, what on earth is wrong with them?

toufka 11y ago
It seems that Apple bet a lot on the TV in the past few release cycles, but that the cable/network execs derailed that plan. In the bay area there were a bunch of Apple TV billboards put up, only to hear within a week that Apple was "frustrated with negotiations over its TV service[1]. There seemed to have been big launch plans that were shelved when Apple couldn't pull all the content producers on board for a grand debut. Seems Apple didn't quite get their way this round, and as a result there are a lot of stale products out there. [1]http://www.businessinsider.com/apple-is-frustrated-with-its-tv-streaming-negotiations-2016-1?op=1 http://www.businessinsider.com/apple-is-frustrated-with-its-...

HSO 11y ago

Re: Declining iPad sales I think the biggest thing Apple could do here is to change their app store policies to (re-)motivate existing developers and attract new ones. Letting prospective buyers test-drive apps, upgrade pricing, and better discovery come to mind. I have both a Mini and a Pro with Pencil and I love the hardware. The software is the problem though. Few apps make use of all the possibilities; existing apps will also have to be (re)written and possibly reconceived for the different form factors. It's a good sign that Phil Schiller is overseeing the app stores now, hopefully something will change this year. Re: iPhone Here, the obvious thing to do seems to produce a new 5S-sized model. 60 percent of 5S or older install base have not upgraded? Maybe there is a reason… Also, they could always try to go "down-market" and produce a greater variety like with the iPod to take further share from Google. I don't see the end of growth in this market, by far. Re: currency effect True, stronger dollar affects revenue or unit sales (where prices have been adapted) relative to previous years. But one could also argue that the years 2009-2014 were special in that the US weakened the dollar through QE, and perhaps Apple (and other US companies) enjoyed "backwinds" then rather than "headwinds" now. It looks whiny to me to say "look ma, 100 then is only 85 now". As someone said, "if my aunt had balls, she'd be my uncle". Macro gives and macro takes. Also, the 214bn cash bandied about should be posed against the debt they took on to pay for the buybacks. So enterprise value not quite as low as suggested but I agree it's an undervalued company.

Spooky23 11y ago
The problem with iPad is that tablet is a tough form factor, and many users aren't big app users -- they are web and media consumers. The price point for a device that works for those users is heading south of $100, while iPad has a 3x entry price. My wife happily uses our iPad 2. I have about 3,000 users of iPad 3's at work who aren't clamor I for new stuff -- it's almost like a thin client lifecycle.
- deleted 11y ago
  [deleted]

draw_down 11y ago

Huh, I guess they really are doomed after all.