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At the end of the line growth has to come from newer categories..as investors/analysts are extremely weary of smartphone growth particularly in the premium market even with the deals in china and russia. Apple will continue to sustain high revenues nicely but the sort of growth people have come to associate with apple will only come from a new category. Its sort of scary to even imagine apple growing like it has done in the past (with new categories) given the size of the company..


all the news from india is that apple is heavily discounting the iphone. its being discounted in the USA as well and its not only best buy doing it. no way you can profit from selling the phone $75 off the regular price

same with china and russia. most people can't afford $800 for a new phone.

even in the USA the customer is king now. AT&T is letting me go to Next with 9 month left on my contract and i'll probably get a Note 3 because you can actually read a book on it
 
the drop in income was miniscule

There was no drop in reported net income. It was a new record.

but its still flat earning year over year.

Only if you ignore my point about deferred revenue.

stocks go up on growth.

Stocks go up for a lot of reasons. Growth is one among many.

no need to buy a 64GB iphone anymore since you can stream all your music via spotify or pandora

Again, iPhone ASP went down $5 (0.8%). Third highest iPhone ASP ever.

anything in the numbers that will send net income up 20% next year?

Again, I was pretty clear that I would expect any significant growth to come from new product lines..
 
any idea on this magical product that half of the adults in the USA will buy over the next 5 years that will give apple gross profits of $300 per device or more? in addition to new iphones and ipads to replace what they have now?
 
any idea on this magical product that half of the adults in the USA will buy over the next 5 years that will give apple gross profits of $300 per device or more? in addition to new iphones and ipads to replace what they have now?

No. (Ignoring the absurdity of your qualifications.) That's why I'm not a billionaire yet. :cool:
 
any idea on this magical product that half of the adults in the USA will buy over the next 5 years that will give apple gross profits of $300 per device or more? in addition to new iphones and ipads to replace what they have now?

It has to be the TV. If you recall, the iPod and iPhone really took of when the content (music and apps) became available through Apple. The technology is here to build a world class TV with a nice interface. But without the content, it will be a commodity product. With content available through Apple, they can charge the magic premium. Will the studios participate?
 
with every TV and blu ray player supporting vudu and cinemanow, a new apple TV will have to do something very special to support a premium
 
The numbers aren't that intimidating for just purposes of estimating. I picked a number in the middle of the pack ($600) and used their overall product margin and came up with $1.34/share. Unless I made a mistake, not far from the mark. Now, was anyone forecasting earnings close to $16.00? Consensus was around $14.00.

No. Professional consensus was around 14.07 and amateur consensus was around 14.85. Apple came in at 14.50. My point, though, is that the professionals were expecting 55-57 million iPhones and EPS of $14.00-$15.00. Apple produced the "right" EPS but missed on the iPhone shipments. They also projected a lower Q2-14. Now it's possible that most of the 8% drop was the forecast, but a lot of the headlines focused on "light" iPhone sales (as it matched the theme from Samsung, LG, and HTC's results). If Apple weren't so transparent about unit sales (i.e. if they were more like Samsung), all we'd have are an EPS "beat," revenue "meet," and forecast "miss" to work with. Instead now we also have an iPhone "miss" in the mix.

Had Apple shipped 55-57 million iPhones, the only way for EPS and Revenue to match what they reported would have been for margin to be lower. Would that have calmed the Street, or did they set up Apple for an impossible scenario in which only a significant "beat" wouldn't have disappointed?
 
with every TV and blu ray player supporting vudu and cinemanow, a new apple TV will have to do something very special to support a premium

The content on both suck. The best content is on bit torrent right now. Apple has to offer something simple and cost effective for users to switch from bit torrent.
 
No. Professional consensus was around 14.07 and amateur consensus was around 14.85. Apple came in at 14.50. My point, though, is that the professionals were expecting 55-57 million iPhones and EPS of $14.00-$15.00. Apple produced the "right" EPS but missed on the iPhone shipments. They also projected a lower Q2-14. Now it's possible that most of the 8% drop was the forecast, but a lot of the headlines focused on "light" iPhone sales (as it matched the theme from Samsung, LG, and HTC's results). If Apple weren't so transparent about unit sales (i.e. if they were more like Samsung), all we'd have are an EPS "beat," revenue "meet," and forecast "miss" to work with. Instead now we also have an iPhone "miss" in the mix.

Had Apple shipped 55-57 million iPhones, the only way for EPS and Revenue to match what they reported would have been for margin to be lower. Would that have calmed the Street, or did they set up Apple for an impossible scenario in which only a significant "beat" wouldn't have disappointed?

you can only play accounting and shipping to channel games so long


the fact is that there are almost no new customers left for the iphone in the USA and to get people to buy it outside the USA they have to discount it very heavily

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The content on both suck. The best content is on bit torrent right now. Apple has to offer something simple and cost effective for users to switch from bit torrent.


same selection as itunes
 
No. Professional consensus was around 14.07 and amateur consensus was around 14.85. Apple came in at 14.50. My point, though, is that the professionals were expecting 55-57 million iPhones and EPS of $14.00-$15.00. Apple produced the "right" EPS but missed on the iPhone shipments. They also projected a lower Q2-14. Now it's possible that most of the 8% drop was the forecast, but a lot of the headlines focused on "light" iPhone sales (as it matched the theme from Samsung, LG, and HTC's results). If Apple weren't so transparent about unit sales (i.e. if they were more like Samsung), all we'd have are an EPS "beat," revenue "meet," and forecast "miss" to work with. Instead now we also have an iPhone "miss" in the mix.

Had Apple shipped 55-57 million iPhones, the only way for EPS and Revenue to match what they reported would have been for margin to be lower. Would that have calmed the Street, or did they set up Apple for an impossible scenario in which only a significant "beat" wouldn't have disappointed?

The "professional" vs. "amateur" thing really gets my goat. This was never the distinction between the types of analysts until MR invented it. Anyhow...

If Apple had shipped another five million iPhones, then EPS would have been more than a dollar higher, and they'd have booked about $3B more in revenue, $1B in earnings, and beaten the street on EPS by around 10%. Everybody would have been thrilled by those results. It's the kind of upside surprise that Apple posted like clockwork, once upon a time. The fact that they didn't this time is attributable to the iPhone miss.
 
you can only play accounting and shipping to channel games so long

Such as...?

the fact is that there are almost no new customers left for the iphone in the USA and to get people to buy it outside the USA they have to discount it very heavily

That's just made up FUD. Once again, iPhone ASP is down $5 (0.8%) from the year ago quarter. It is the third highest quarterly ASP ever.
 
The "professional" vs. "amateur" thing really gets my goat. This was never the distinction between the types of analysts until MR invented it. Anyhow...

If Apple had shipped another five million iPhones, then EPS would have been more than a dollar higher, and they'd have booked about $3B more in revenue, $1B in earnings, and beaten the street on EPS by around 10%. Everybody would have been thrilled by those results. It's the kind of upside surprise that Apple posted like clockwork, once upon a time. The fact that they didn't this time is attributable to the iPhone miss.

Or... Apple used to low ball guidance. (Usually by a very consistent percentage.) It took a long time for analysts to catch on, and eventually they began to over-compensate. Once they did, Apple switched to a much more reliable range in their guidance to discourage the more outlandish estimates.

Just a theory, of course! I'm not saying it's better than your explanation. :)
 
Or... Apple used to low ball guidance. (Usually by a very consistent percentage.) It took a long time for analysts to catch on, and eventually they began to over-compensate. Once they did, Apple switched to a much more reliable range in their guidance to discourage the more outlandish estimates.

Just a theory, of course! I'm not saying it's better than your explanation. :)

Except that Apple admitted in the conference call that they didn't get the mix on the new models right. Not that guidance has much if anything to do with the models the analysts use to make their forecasts.
 
Didn't I read somewhere that US was actually down YoY?

US what? :)

Revenue from the Americas (North and South) was down about 1% if that is what you are referring to.

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Except that Apple admitted in the conference call that they didn't get the mix on the new models right. Not that guidance has much if anything to do with the models the analysts use to make their forecasts.

That's true. They did leave some iPhone 5S sales on the table last quarter.
 
Such as...?



That's just made up FUD. Once again, iPhone ASP is down $5 (0.8%) from the year ago quarter. It is the third highest quarterly ASP ever.

iphone ASP is down
people don't care about it except the fanboy rush for the 2 months after its released

used to be apple literally sold every iphone it made at full price, now its discounted 2 months after release

lower ASP's mean lower profits and no growth. go read the articles about iphone in india. apple is discounting it because its too expensive. china release isn't very hot either.

same story as windows almost 15 years ago. US market was saturated and it was too expensive for outside the USA
 
iphone ASP is down
people don't care about it except the fanboy rush for the 2 months after its released

used to be apple literally sold every iphone it made at full price, now its discounted 2 months after release

Apple still sold them at full price! Retailers discount them to encourage traffic to their stores. The 0.8% decrease in ASP had nothing to do with discounting!

lower ASP's mean lower profits and no growth. go read the articles about iphone in india. apple is discounting it because its too expensive. china release isn't very hot either.

Again, there was no significant decrease in ASP. Why do you keep repeating this?
 
US what? :)

Revenue from the Americas (North and South) was down about 1% if that is what you are referring to.

Thanks for the clarification.

http://techcrunch.com/2014/01/27/apple-international-q1-2014/
Apple CEO Tim Cook today admitted that in its home market of North America, “we did not do as well…our business contracted year over year.”

Isn't this a concern? The one market where they do best over Android is shrinking? In a quarter where they launched some blockbuster products. What does that say about the market in general? What I read is that all future growth will come from international markets where there is more competition and fewer carrier subsidies. Also, most of the growth will be on the low-end.
 
If you're long on an investment, who cares what happens day-to-day? Unless you're trying to time the market yourself, these "gamblers" shouldn't bother you at all.

It matters because such wreckless speculation pushes businesses to do stupid things such as share buy backs with borrowed money. It is the short term investors like Icahnn that undermine confidence in the market for the average investor.
 
The "professional" vs. "amateur" thing really gets my goat. This was never the distinction between the types of analysts until MR invented it. Anyhow...

If Apple had shipped another five million iPhones, then EPS would have been more than a dollar higher, and they'd have booked about $3B more in revenue, $1B in earnings, and beaten the street on EPS by around 10%. Everybody would have been thrilled by those results. It's the kind of upside surprise that Apple posted like clockwork, once upon a time. The fact that they didn't this time is attributable to the iPhone miss.

You are oversimplifying it. The "professional" analysts work for investment banking firms. The "amateurs" are just that (bloggers, etc).

Also, the main reason that Apple used to blow past their guidance was that they set overly conservative guidance. For the past year, they have set realistic guidance. Peter Oppenheimer said so last year at the Q1 release.

Finally, we don't know what EPS would have been had they shipped another 5 million iPhones. It depends on which model. If they shipped 5 million more total, but 10 million were the 4s and 5c, they'd have had lower margins and lower EPS.

My point is that few of the analysts, "pro" or "amateur" predicted an EPS or margin wildly different from Apple's actual results. Yet they all expected significantly more iPhone sales. That makes no mathematical sense unless they expected more of the lower-margin devices to sell. But if that's the case, then it doesn't make sense why they want Apple to go downmarket.

----------

Thanks for the clarification.

http://techcrunch.com/2014/01/27/apple-international-q1-2014/
Apple CEO Tim Cook today admitted that in its home market of North America, “we did not do as well…our business contracted year over year.”

Isn't this a concern? The one market where they do best over Android is shrinking? In a quarter where they launched some blockbuster products. What does that say about the market in general? What I read is that all future growth will come from international markets where there is more competition and fewer carrier subsidies. Also, most of the growth will be on the low-end.

It's probably a case of the North American market changing. Android didn't exactly light the world on fire, either. Remember, Verizon reported lower overall sales. They and AT&T changed their upgrade policies. And the drop in North America was more than offset by adding NTT DoCoMo. The market where Apple did best was Japan (69% of the smartphone market).

----------

Except that Apple admitted in the conference call that they didn't get the mix on the new models right. Not that guidance has much if anything to do with the models the analysts use to make their forecasts.

Nevertheless, Apple's overall top line and bottom line results were in line with their forecasts. Had Apple performed as they thought they might 3 months ago, then they might well have sold 55 million iPhones as the analysts wanted and had revenue and EPS virtually identical to what they actually reported. It doesn't make sense that getting the "mix" wrong but posting the same results would lead to the stock getting hammered. Perhaps the Q2-14 forecast spooked investors, but the headlines focused more on the iPhone "miss" and "flat earnings." The "flat earnings" is a red herring since Apple predicted "flat" earnings 3 months ago. Also, "increased competition" from Samsung doesn't explain it either, since Samsung also fell well short of expectations.

----------

iphone ASP is down
people don't care about it except the fanboy rush for the 2 months after its released

The iPhone ASP was down a "whopping" $5 from the year ago quarter (still at $644). That's a lot better than the rest of the industry.

----------

you can only play accounting and shipping to channel games so long


the fact is that there are almost no new customers left for the iphone in the USA and to get people to buy it outside the USA they have to discount it very heavily

----------




same selection as itunes

Apple doesn't play accounting and shipping games. They made an active push to sell more phones in their own stores this year, which actually delays recognition of sales. And they deferred more revenue. So the "tricks" actually slowed down recognition.

The fact is that there are lots of potential customers in the USA, such as those waiting for larger screened phones. And the fact is that they experienced significant growth in Japan (where their market share is 69%), Latin America, and Greater China last quarter. The iPhone sells for more in China and Japan than it does in the US.
 
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