Apple Records Q4 2012 Earnings of $8.2B on $36B in Revenue, Tops $150B in Sales for Fiscal 2012 [Call Ended]

[ghsDUDE]

The stock is down $2 after hours. AAPL is doomed for sure!

You're an idiot. It doesn't work like that. Their guidance for the best selling time of the season is down in percent compared to last year...even with all of these new products. And they're trying to blame it on last year having 1 more week in it. The market may be saturated...you can't grow as fast as you want when everyone has already converted.

 

[iMikeT]

Maybe if the stupid US government would allow them to bring this back without ridiculous high taxes they would do something with it.

What country do you live in?

 

[lilo777]

So in a sane stock market world of borderline common sense apples market cap is undervalued by 1-2 trillion dollars.

Yes. And tomorrow, most likely, it will be "undervalued" even more

 

[iMikeT]

Yes. And tomorrow, most likely, it will be "undervalued" even more

I guess we'll find out as AAPL is back to trading at today's close in the after hours session.

 

[Dan--]

Cannibalization

We've learned not to worry about cannibalization of our own products. Better for us to do it than for someone else to.

This was my favorite quote from the article.

Maybe they'll eventually release a performance oriented desktop that's roughly half the price of the behemoth Mac Pro. With no monitor built in.

I would have said "headless iMac", but with the iMac taking in more and more laptop parts, we don't want that anymore. Desktop processor, desktop graphics, desktop hard drives, some mild expandability inside. Still with an optical drive. All starting about $1000.

Hey, I can dream.

 

[Demonofelru]

No, they don't. Analysts have actual sales information through surveys and supply chain checks to look at during and after the quarter. Apple only has historical information to base its guidance on before the quarter. Their main advantages are in new product release dates and supply issues.

We're going to have to agree to disagree I guess, surveys and supply checks are not actual sales information. Example being they wouldn't have projected ~8 million iPhone 5's in 48 hours. Apple NEVER would have projected 8 million since they knew they didn't have 8 million analysts didn't know there was supply constraints.

 

[Taz Mangus]

I guess we'll find out as AAPL is back to trading at today's close in the after hours session.

Historically Apple stock has gone through cycles like this. The stock price will be back over $700 by the end of the year easily.

 

[IJ Reilly]

It is not like they have it all sitting around in low yield checking account. Their last balance sheet showed $19B in Short Term Investments, and $89B in Long Term Investments. From their financial statements it is a little hard to tell how big of a return they are getting on those investments, but you can bet it is decent.

Having a hord of cash is a strategic advantage for Apple that allows them to enter into supplier agreements that others are not able to. This allows Apple to get high quality Flash, and displays at a good price that other companies can not. They can write multi-billion dollar checks to their suppliers to buy up their supply at a low cost.

The principle here is that Apple is not a bank. They don't maximize growth by investing profits in anything outside of their own business. It's a basic article of capitalism that a company gets the best possible return from their profits by investing them back into the business they know how to do best. Investing in securities is not Apple's forte; building consumer electronics products is. Any dollar of profits not spent on that mission raises questions about capital management.

Apple has far more cash than they could possibly use for leveraging supply, unless they are planning on buying out most of their biggest suppliers in total. The argument that they need this money for something became null and void about five years ago. The cash hoard has done nothing but explode since.

 

[OSMac]

Apple has had an incredible run, I've noticed the local store is not as busy as it might have been, but sure a lot busier than the nearby closed Sony Store or often empty hallways in Bestbuy.

Tech device fad may be ending, but its been one heck of a ride.

Not many going to lose selling at $600.

 

[JonIrons]

So in a sane stock market world of borderline common sense apples market cap is undervalued by 1-2 trillion dollars.

I have to agree with you, Apple seems so incredibly undervalued, I really don't know what is holding it back?

Personally I have a pretty big split, 5+:1 would be beneficial, but Apple seem resistant to do that.

Still, here's hoping for a strong Q1 and see AAPL return to $700 and beyond.

 

[the8thark]

I've never seen any CPU's for sale from Apple.

I agree. Almost every Apple product sold has a CPU in it. I'm sure they mean Mac sales. They should just say that. Cause their CPU sales is technically wrong. For example iOS devices have a CPU too.

If MR cared they'd fix this up. Not sure if they do though.

 

[Demonofelru]

It is not like they have it all sitting around in low yield checking account. Their last balance sheet showed $19B in Short Term Investments, and $89B in Long Term Investments. From their financial statements it is a little hard to tell how big of a return they are getting on those investments. From 2010 to 2011 they went from $25B to $55B in long term investments, after depositing $24B into investments that year. Back of the envelope shows a 24% return on long term investments over that year.

Having a hord of cash is a strategic advantage for Apple that allows them to enter into supplier agreements that others are not able to. This allows Apple to get high quality Flash, and displays at a good price that other companies can not. They can write multi-billion dollar checks to their suppliers to buy up their supply at a low cost.

I was going to respond but couldn't say it better then IJ Reilly his response is how I would have responded pretty much to a T AAPL isn't Berkshire Hathaway.

 

[IJ Reilly]

I have to agree with you, Apple seems so incredibly undervalued, I really don't know what is holding it back?

Personally I have a pretty big split, 5+:1 would be beneficial, but Apple seem resistant to do that.

Still, here's hoping for a strong Q1 and see AAPL return to $700 and beyond.

If I gave you two tens for a twenty, would you have more money?

 

[danielwsmithee]

The principle here is that Apple is not a bank. They don't maximize growth by investing profits in anything outside of their own business. It's a basic article of capitalism that a company gets the best possible return from their profits by investing them back into the business they know how to do best. Investing in securities is not Apple's forte.

Apple has far more cash than they could possibly use for leveraging supply, unless they are planning on buying out most of their biggest suppliers in total. The argument that they need this money for something became null and void about five years ago. The cash hoard has done nothing but explode since.

I agree with your statement about not being a bank, and they should be invested in operations. However at the same time I'm not at all upset by them keeping a sufficient supply of capital to make strategic investments. As an investor I would much rather have Apple holding onto extra cash then to leverage like many other companies (even though that would improve ROE at the cost of additional risk). I'm in agreement that I would like to see a much larger dividend payed out.

 

[Thunderhawks]

US based company. Uses public services in the US. It makes no difference where in the world the money was made, these companies should still pay taxes to a government and people they call home. Where is your patriotism?

Full disclosure so you know I'm no anti-business hippie. I have owned and operated my own business. I trade in the open market. I am holding a long position in AAPL. On top of all that, I have no problem with paying taxes to the USA. This country is my home and has given me more than the country my parents are from. Government keeping its head out of business? Pluh-eese! If it weren't for government setting up the infrastructure for these very businesses, none of them would exist, Apple included.

Overly simplified and money doesn't know patriotism.
It is a resource that vaporizes with the slightest sign of resistance. It will always go where there is no resistance or the least amount.

Companies making money abroad use other countries infrastructure. They get taxed there and why should they get taxed again, just because they are American?

And, to summarize:

As long as the laws are the way they are and companies follow them you have no leg to stand on, but morals.

Guess what: Money has NO MORALS

 

[marksman]

Oh yeah most of the questions asked were stupid, annoying, repetitive or all three.

 

[Demonofelru]

If I gave you two tens for a twenty, would you have more money?

Although I agree it shouldn't effect price fundamentally, I REALLY hope they do a 5:1 or better yet a 10:1 split; if for no other reason then I am a pretty conservative investor so would like to write covered calls on my position to extract premium and at around $60,000 per contract I can do 1 contract and even that is making it so my portfolio isn't diversified well.

 

[lunaoso]

I agree. Almost every Apple product sold has a CPU in it. I'm sure they mean Mac sales. They should just say that. Cause their CPU sales is technically wrong. For example iOS devices have a CPU too.

If MR cared they'd fix this up. Not sure if they do though.

You are technically right, but CPU is usually used as an abr. for computer. They should have just said Macs though.

 

[Dan--]

I'm in agreement that I would like to see a much larger dividend payed out.

I'd rather see increased stock buyback. That increases the value of the shares w/o any tax implications.

 

[marksman]

Then when the iPhone is no longer popular, what will happen to Apple then?


Plus it's kind of depressing to see that a computer company barely sells any computers anymore looking at that chart.

No computer company sells what you myopically deem computers as well as apple sells tablets, for instance.

 

[IJ Reilly]

I agree with your statement about not being a bank, and they should be invested in operations. However at the same time I'm not at all upset by them keeping a sufficient supply of capital to make strategic investments. As an investor I would much rather have Apple holding onto extra cash then to leverage like many other companies (even though that would improve ROE at the cost of additional risk). I'm in agreement that I would like to see a much larger dividend payed out.

Even in that case, $20B would be more than sufficient. I was getting into this same argument years ago, when the cash hoard was "only" that much. As we can see now, the dividend barely made a dent in the accumulation rate. At least now more people seem to accept that Apple can pay a dividend without even breaking a sweat.

 

[JonIrons]

If I gave you two tens for a twenty, would you have more money?

No, but I could give them away more easily. $100/share is much less of a daunting figure for any investor. Obviously nothing will have changed, just a thought really!

 

[Demonofelru]

I agree with your statement about not being a bank, and they should be invested in operations. However at the same time I'm not at all upset by them keeping a sufficient supply of capital to make strategic investments. As an investor I would much rather have Apple holding onto extra cash then to leverage like many other companies (even though that would improve ROE at the cost of additional risk). I'm in agreement that I would like to see a much larger dividend payed out.

I doubt anyone would complain about keeping a sufficient amount of money, I just think most people complaining like me think "sufficient" came and passed LONG ago their cash hoard is equivalent to a mega cap by itself pretty much they have more cash then Intel's entire market cap and Intel is not a small company.

 

[IJ Reilly]

Although I agree it shouldn't effect price fundamentally, I REALLY hope they do a 5:1 or better yet a 10:1 split; if for no other reason then I am a pretty conservative investor so would like to write covered calls on my position to extract premium and at around $60,000 per contract I can do 1 contract and even that is making it so my portfolio isn't diversified well.

The best reasoning I've heard yet.

No, but I could give them away more easily. $100/share is much less of a daunting figure for any investor. Obviously nothing will have changed, just a thought really!

Only to people who have no idea what they are doing. At some point the cost of one share becomes prohibitive for some individual investors, but I think we can agree that people who can't afford to invest $600 are not driving the markets.

 

[danielwsmithee]

Even in that case, $20B would be more than sufficient. I was getting into this same argument years ago, when the cash hoard was "only" that much. As we can see now, the dividend barely made a dent in the accumulation rate. At least now more people seem to accept that Apple can pay a dividend without breaking a sweat.

Yes when the dividend was first announced it was clear that it would not make a dent in the accumulation of cash. I would like to see larger number than $20B, more like $50B but that is just me. It was pretty short time frame where Apple wrote out checks of $14B, $7B, and $7B for flash, lithium batteries, and LCDs. Which they are benefiting from tremendously.

I also wonder how many of those long term investments are equity in their suppliers. If they hold large equity stakes in suppliers it may harm their suppliers to liquidate those assets very quickly.