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Apple Reports First Year-Over-Year Revenue Decline Since 2003: $10.5B Profit on $50.6B in Revenue

Breaking news - a dead body has been found in Apple HQ conference room - now confirmed news.
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SusanK said:
No foresight at all on that premier issue of MacAddict. It's a disease. Loved my Macs! Great thing about that addiction, TC seems to be the cure ;)
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That will be a great quote: Cook as the antidote for Apple enthusiasm ....
 
Apple Corps said:
Breaking news - a dead body has been found in Apple HQ conference room - now confirmed news.
[doublepost=1461784561][/doublepost]

That will be a great quote: Cook as the antidote for Apple enthusiasm ....
Click to expand...

It's yours. Enjoy. Maybe it just generational. They don't make em like they used to. I just shutdown the new Mac. El Capitan must be an acquired taste. I'm not there yet. Something about pastel spreadsheets bugs me. Adult coloring anyone ?

 
So, let me get this straight, Apple had a 10.5 BILLION, that's right, Billions net quarterly profit (that's after all their bills are paid, right?). And this is news why? Because they didn't NET as much as last year in the same quarter?.?.? 10.5 Billion, I still can't rap my head around that, well I can, but really, when they take a LOSS in the quarter, then maybe it's news.
 
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Grahamps said:
In Atlanta, I randomly see many people wearing them everyday... what shocked me last week was when I saw three employees at the oil change shop wearing them; either they earn more than I'd ever imagine, or they received them as bonuses.
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617aircav said:
Really. The watches are as low as $300.
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Well, minimum wage in Atlanta is going to be around $7.50/hour. The oil change shop isn't likely paying much more than that. So that's an annual income of about $15,600/year. So $299 +tax (assuming they all bought the 38mm Sport after the price drop), is about 2% of their annual income -- assuming they work year round without any days off, or unpaid sick leave, and do not have supplemental income from another job, family, or other source. 2% of anyone's annual income is a lot, but especially when their income is only about $4,000 above the poverty level.

So hopefully there's more there than meets the eye -- if not additional income, then a gift, or it provides an essential service like monitoring a dependent while at work.

That said, I see the Watch most often on low wage earners, whereas I almost never see it on what I presume to be Apple's intended target: affluent corporate executives. And even then, I most always see the least expensive Sport watch, and not the higher end stainless models.
 
Mac 128 said:
Well, minimum wage in Atlanta is going to be around $7.50/hour. The oil change shop isn't likely paying much more than that. So that's an annual income of about $15,600/year. So $299 +tax (assuming they all bought the 38mm Sport after the price drop), is about 2% of their annual income -- assuming they work year round without any days off, or unpaid sick leave, and do not have supplemental income from another job, family, or other source. 2% of anyone's annual income is a lot, but especially when their income is only about $4,000 above the poverty level.

So hopefully there's more there than meets the eye -- if not additional income, then a gift, or it provides an essential service like monitoring a dependent while at work.

That said, I see the Watch most often on low wage earners, whereas I almost never see it on what I presume to be Apple's intended target: affluent corporate executives.
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this is something that I see happen here, and its really common through the millenial generation. "we can't find good work!" "there's no money!" "the 1% are ruining us!" "W'er all poor and poverty!"..

but they all walk around with iPhones and Apple Watches.

It makes me wonder how the hell these "poor" people all have flagship smartphones and smartwatches, complain about being poor and unemployed, but then turn around and call people who use non-iphones "poor" and the like.

Entitlements
 
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Moorepheus said:
So, let me get this straight, Apple had a 10.5 BILLION, that's right, Billions net quarterly profit (that's after all their bills are paid, right?). And this is news why? Because they didn't NET as much as last year in the same quarter?.?.? 10.5 Billion, I still can't rap my head around that, well I can, but really, when they take a LOSS in the quarter, then maybe it's news.
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Let me see if I can help you get your head around the issue. The stock market values future earnings. The slowdown in iPhone sales may portend lower future sales. This concern is amplified by the fact that Apple is so dependent on one product - the iPhone. That "amplified concern" is even worse when one considers that Tim Cook has been CEO for 5 years now and has yet to envision and launch a game changing product that moves the stock needle. AAPL is trading recently where it was 4 years ago - not a good thing. The growing narrative / concern is that Cook is not a product guy / innovator. Apple is at risk as a one product company.

Does that help a bit?

BTW - what could Timmy have done? Ummm - social media / video content & streaming / own the living room hardware / home automation / cloud services / etc.
 
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Apple Corps said:
Let me see if I can help you get your head around the issue. The stock market values future earnings. The slowdown in iPhone sales may portend lower future sales. This concern is amplified by the fact that Apple is so dependent on one product - the iPhone. That "amplified concern" is even worse when one considers that Tim Cook has been CEO for 5 years now and has yet to envision and launch a game changing product that moves the stock needle. AAPL is trading recently where it was 4 years ago - not a good thing. The growing narrative / concern is that Cook is not a product guy / innovator. Apple is at risk as a one product company.

Does that help a bit?
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I do understand that, so I guess it's time for apple to innovate again, because, in my opinion, as it seems in yours, that they have failed to do that in 4 years. And leaning on one product once the market is saturated with them is going to be hard to keep the numbers up, no matter how much improvement you do to them, just look at the PC market, all manufactures are seeing declines there.

While I feel for the share holders, ok, not really, they still making money hand over fist here, this was bound to happen. Also, that is why my portfolio is diversified and not all in one basket, like APPLE seems to be with the iPhone.
 
As someone who left the iPhone with the release of the 4S (2011?), this is what I've been waiting for.

I loved the iPhone at the beginning and I still love my Mac. But the iPhone became uninspiring, too expensive for what it offered, and Android offered greater choice, usability, SD card slots blah blah.

But why would Apple change anything? They kept releasing essentially the same phone with minor, inconsequential updates, and people lapped it up and bought them by the millions. Profits up, sales up... why change anything?

I don't blame Apple. I blame the millions of people blindly buying the iPhone year after year, lauding its design and innovation when, actually, it's been the same for years while the competition has made better hardware and progressed.

Now, with sales declining, profits declining and the share price in a dive, I hope Apple will sit-up and pull their finger out. I look forward to becoming an iPhone user once again.
 
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TheRainKing said:
I bet Apple had visions of the Apple Watch taking off like the iPad or something. I still haven't seen a single person wearing one.
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Issue is that smartphones have displaced watches a lot. Your phone shows the time. People don't like having redundant devices on them.
 
AFEPPL said:
But they also made more than many companies are worth...
Well done Tim, good job.
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Or - great job Steve - thank you for envisioning and propelling game game changing products into the market: Macs / iPod / iTunes / iPhone / iPad. Your successors have tweaked these game changers to keep them fresh - but the real value added was your vision.
 
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LordVic said:
And I say you're misusing this number and using it wrong.

Claiming that one companies smartphones is the biggest profit centre isn't a winning statistic to me.
Let me start by sayign: I Think the iPhone is a hell of a beautiful smartphone, that is well engineered, feels good in hand and looks great, and performs very well.

BUT:

It clearly puts in less technological items / stats / performance parts than many of the other people in the market. Apple's iPhones pricing and build are primarily focused on profit margins and not deliverying the highest, newest and best technologies available. Apple is fantastic company at refinement and thats what the iPhone is. It's a really good refinement of existing technologies, Most of which were pioneered by others, but refined into a nicer package on the iPhone.

Because of this, Apple charges full price flagship price, But, with overall less in it. Smaller Flash storage, Less RAM, lower resolution displays on older mroe mature (and cheaper to produce) LCD's. These cost savings for Apple, do not get passed along to the consumer. Instead, Apple pockets the difference as profits.

Eventually, And we're starting to see it in the market, this starts to feel like the "Apple Tax". You are literally paying more for an Apple device because it has the logo on it, Not because of any of the actual technology in the device. When you're a consumer and you hear that on every single iPhone sold, apple is earning almost 40% Pure profit off of your purchase, you start to wonder "why can't they afford to give us 32gb base?" or "Where's my 2-4GB ram base?". "where's my open NFC?", "where's my __________". Aside from iOS v Android debate right now, There is very little in an iPhone from a technological standpoint that makes the iPhone's hardware stand above and beyond most of the compteition. In fact, despite lower profits, many of the competition are selling items that are generally more "spec heavy" than iPhones.

So at the end of the day. As the consumer. Repeating "BUT APPPLE HAS 90% OF THE SMARTPHONE PROFITS" is actually a bad thing. Not a good thing. Knowing Apple is pocketting 40% of my purchase to give to Ive and Cook's already full pockets doesn't make me feel good about 90% profits in the industry. Especially with the Tax Avoidance and other legal issues that Apple has historically abused.

Apple makes some really nice products. But corporate ethics of theirs, and their rampant profiteering past reasonability makes Apple Co. ethically and morally questionable. And the 90% profit mantra just exemplifies that, NOT helps
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I am reminded of the time I had a bad case of skin allergies. Saw a few doctors near my home, got some medicine, but none of it helped. Finally went to see a skin specialist. The doctor was able to accurately diagnose my problem within minutes and issued me some pills which didn't seem all that expensive, but the overall consultation cost more than all my earlier visits combined.

But hey, it got the problem solved. This made me realise - I wasn't so much paying for the medicine as I was paying for the doctor's expertise in resolving my ailment and knowing precisely how to treat it. The earlier doctors charged less, and see where their treatment got me.

I see a similar corollary here. On paper, the iPhone has less powerful specs, and logic dictates that if Apple is earning more, that means I am not getting my money's worth. But what I am paying for here is Apple's expertise in being able to put all these parts together in a manner which results in the best user experience for me.

Specs are the means. User experience is the end. All the specs in the world is meaningless if it results in a subpar user experience for me.

With the competition, I get more specs, and that's pretty much it. There is no skill or finesse involved in including more ram or a faster processor, and the slim margins of these Android OEMS means that it is unlikely they will ever have the resources to create non-spec related innovations such as force touch, custom processors, true-tone display etc. Much less round out the ecosystem by say, starting up your own music streaming service, working out deals to roll out Apple Pay (which recently just became available in my country), having your own mapping service as a key differently etc.

Here, the benefits are more intangible. We can't straight-up compare them on a spreadsheet, but that doesn't mean the benefits can't be measured, much less matter.

So in a nutshell, Apple is nevertheless able to offer a way more compelling user experience for me despite evidently skimping on specs here and there, and therefore I feel that they deserve every cent of profit they make (from me at least), however disgusting or excessive it may seem to you.
 
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Haha! Apple's ship is sinking! Good job not keeping current with your hardware Apple, it's finally come back to bite you :p
 
Analog Kid said:
I'm what many would consider a power user, and my advice these days is consistently "you probably don't need a new computer". Not only because the newer models aren't advancing quickly enough, but because user requirements aren't advancing. SSDs were the last big advance, so you want one of those, but everything else is pretty much gravy.

. . . . .

So yeah, there are a few tech junkies who always want the latest acronyms in their hardware, but that's not a growth path for a company as large as Apple, even considering knock-on effects. Apple, as a business, is focused on profit margins-- how much value do they as an enterprise add to their products. They will always focus their strategy at where they see they have value, and where that margin holds up. If that means declining unit sales, and reduced update cycles then they'll probably follow that path until they exit the market.

I'd be really surprised if they suddenly implement a strategy of more but smaller updates pursuing unit sales over profit as they chase a stagnating market.
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I hear you on all that. Very true. What I don't understand is why it would take that much time and cost to incorporate the latest CPU and GPUs into form factors like the Mini and Mac Pro. Sure many of us don't need more power. But the Mac Pro is niche and that niche does need the power. How many engineers would it take to have incorporated some a new GPU in the Mac Pro at some point in the last year? You would almost think Apple would want to refresh the Mac Pro out of freaking pride. It is an amazing looking tower and they spent so much time working on the design and the form factor. How about upgrading the thunderbolt monitor? Why has that just been sitting there for years untouched? It is a freaking monitor. You are just sourcing a panel and sticking it in your Apple casing. Seems like a small team could crank that out in a month. I just don't see that as a distraction, while it services your best and most high end customers.
 
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Abazigal said:
I am reminded of the time I had a bad case of skin allergies. Saw a few doctors near my home, got some medicine, but none of it helped. Finally went to see a skin specialist. The doctor was able to accurately diagnose my problem within minutes and issued me some pills which didn't seem all that expensive, but the overall consultation cost more than all my earlier visits combined.

But hey, it got the problem solved. This made me realise - I wasn't so much paying for the medicine as I was paying for the doctor's expertise in resolving my ailment and knowing precisely how to treat it. The earlier doctors charged less, and see where their treatment got me.

I see a similar corollary here. On paper, the iPhone has less powerful specs, and logic dictates that if Apple is earning more, that means I am not getting my money's worth. But what I am paying for here is Apple's expertise in being able to put all these parts together in a manner which results in the best user experience for me.

Specs are the means. User experience is the end. All the specs in the world is meaningless if it results in a subpar user experience for me.

With the competition, I get more specs, and that's pretty much it. There is no skill or finesse involved in including more ram or a faster processor, and the slim margins of these Android OEMS means that it is unlikely they will ever have the resources to create non-spec related innovations such as force touch, custom processors, true-tone display etc. Much less round out the ecosystem by say, starting up your own music streaming service, working out deals to roll out Apple Pay (which recently just became available in my country), having your own mapping service as a key differently etc.

Here, the benefits are more intangible. We can't straight-up compare them on a spreadsheet, but that doesn't mean the benefits can't be measured, much less matter.

So in a nutshell, Apple is nevertheless able to offer a way more compelling user experience for me despite evidently skimping on specs here and there, and therefore I feel that they deserve every cent of profit they make (from me at least), however disgusting or excessive it may seem to you.
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These are all legit. I wouldn't ever mean to tell you that what you have as value for intangibles is in anyway invalid.

And I am admitingly only stating one perspective.

But that still doesn't change that the 90 percent (also, is it just me or did I just realize now there's no percent key on the iOS keyboard) figure really isn't as meaningful as most would like to believe. None of the reasons you stated changes what I said. What it changes is that you find enough value as is. And there is absolutely nothing wrong with that. And nobody has the right to tell you that you're wrong for that.
 
Abazigal said:
I see a similar corollary here. On paper, the iPhone has less powerful specs, and logic dictates that if Apple is earning more, that means I am not getting my money's worth. But what I am paying for here is Apple's expertise in being able to put all these parts together in a manner which results in the best user experience for me.

Specs are the means. User experience is the end. All the specs in the world is meaningless if it results in a subpar user experience for me.
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You can't justify user experience when your battery runs out half way through the day and takes far longer to recharge than any phone with QuickCharge on the market.

You also can't justify user experience when your operating system has become terribly bloated and you are still selling 1500 dollar laptops with 3 year old processors on it.

Yes its only one quarter, but they forecasting a decline for next quarter which will include iPhone 5SE sales and maybe even iPhone 7. Apple is behind the times, it needs not only catch up but pull ahead.
 
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While the Apple-haters are dancing around this like a fire sacrifice, my view on this is different.

Yes, the profits are lower but Apple is doing some significant investments for long term results.

The new campus will return massive increased productivity. A Xanadu design is very expensive to pull off but when used, is very productive. This is where we get the idiom "inner circle."

They are developing an electric car that will disrupt automotive like the iPhone did cellular. Who knows what else is in progress that wasn't leaked.

As for the watch, saying it is not successful is like saying a batter hits .380 for a season instead of the "expected" .400 by some arbitrary expectation and is a failure. The Apple Watch is profitable and making money. There is a second generation coming out. Also, Pebble's and Android Wear's growth has been stunted by the Apple Watch.

This is just a "take one for the team" quarter with a lot of long term investments in progress. There will be no stock holders rebellion.
 
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