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Apple Signals Return to Growth This Holiday Season After 9-Month Slide

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Apple today forecasted between $76 billion and $78 billion in revenue for the first quarter of the 2017 fiscal year, reflecting a three-month period between September and December, signaling the company's return to growth in the upcoming holiday shopping season.

Apple's lower-end guidance of $76 billion would be enough to eclipse the $75.9 billion in revenue it reported in the year-ago period, putting an end to the company's downturn after its first annual revenue decline since 2001 and three consecutive quarters of negative growth.

Apple's decline through the first nine months of 2016 was in line with the iPhone's first-ever drop in sales, while iPad and Mac sales also shrunk during the year. However, the strength of the iPhone 7 and iPhone 7 Plus, alongside Apple's growing services category, should help reverse that trend over the next three months. In the quarter just ended, Apple's revenue from services like the App Store, Apple Music, and iCloud grew 24% to an all-time record of $6.3 billion.

Article Link: Apple Signals Return to Growth This Holiday Season After 9-Month Slide
 

Carlanga

macrumors 604
Nov 5, 2009
7,020
1,308
No contract pricing on phones it equals less sales for full price even in payment plans. Lately there has been a lot of offers for a free upgrade of devices which leds me to believe it might be the reason for the better sales of the iPhone 7.

I read somewhere else that smartwatch es are tanking as a market. Apple must be worried since I haven't heard about new bands like previous year.
 
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Three141

macrumors 6502
Jan 1, 2016
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I wonder if we will ever get to the point where Apple earning let's say 60 billion in revenue will not be seen as a negative.

That thought aside, sounds like they are expecting some good sales from the revised laptops and maybe even a planned surprise upgrade to one or all of their desktops?
 
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Carlanga

macrumors 604
Nov 5, 2009
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Love the picture! :p

I can't stand investors and analysts. A company can't grow into perpetuity. They want year over year revenue and market growth forever. That isn't sustainable. I think $9 Billion is pretty incredible.

Corporations are "people". You can't win them all.
 
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Constable Odo

macrumors 6502
Mar 28, 2008
461
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Love the picture! :p

I can't stand investors and analysts. A company can't grow into perpetuity. They want year over year revenue and market growth forever. That isn't sustainable. I think $9 Billion is pretty incredible.
Of course, eternal growth of no company is sustainable in a finite world. However, investors don't care about such rules. They dump the company that can't sustain growth and move on to another company than can. There are plenty of other major tech companies to move on to. Both Amazon and Alphabet can sustain growth and now so can Microsoft and that's where the investors are going. The thing is, Tim Cook and Apple had been warned for a long time about depending upon only iPhone sales. Apple has had the means or the cash to get into other businesses. No one at Apple is willing to take any risk so they keep doing the same thing over and over.

Apple had as much of an opportunity or better to establish a powerful cloud computing business as any of the other major tech companies. Apple could have also purchased DuckDuckGo and tried to go head-to-head with Google's search/ad business and also build a knowledge engine for Siri. Why should Apple leave Alphabet a clear field when Alphabet is basically crippling Apple's iPhone business with Android and also offering competitive smartphones, too. Apple's management is just stupid or blind to allow a company to steal their lunch and then do nothing about stealing it back. AppleWatch is not even close to being a multi-billion dollar long-term cloud computing business. Everyone on Wall Street knew AppleWatch would quickly fail from the very beginning. It's growth has already stopped and is in decline.

Do I think I could run Apple better than it is being run? Absolutely not. I only see what other major tech companies are doing to keep growing their revenue. It just makes sense if a company has a means to grow then why not pursue it instead of simply coasting like Apple is doing. I realize Apple's mountain of cash is stuck overseas but it's possible Apple put too much emphasis on stock buybacks instead of acquisitions. This I'm saying in hindsight and I also have no idea of what Apple's end goals are. I'm just saying that when a company like Microsoft is more than managing its Windows sales slowdown and the complete collapse of its mobile business and yet Wall Street sees more prospects in Microsoft than Apple, then something is definitely wrong.

I do know that all the other major tech companies will be posting decent share gains on earnings and only Apple's share price will be declining. It's becoming a theme for Tim Cook and Apple. It's something shareholders are almost expecting every quarter and it's quite disappointing.
 
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Keane16

macrumors 6502a
Dec 8, 2007
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It just makes sense if a company has a means to grow then why not pursue it instead of simply coasting like Apple is doing.

This has been a theme for Apple for a long, long time. Somebody posted a link to the original iPod reveal thread the other day when the 15th Anniversary came around. There were so many comments echoing this sentiment - Apple should do this, Apple should do that. And here we are in 2016 and people still parrot it.

Apple has had the means or the cash to get into other businesses. No one at Apple is willing to take any risk so they keep doing the same thing over and over.

Off the top of my head in the last 4/5 years they've added:
  • Smartwatches
  • Headphones
  • Music streaming
  • Maps
  • iCloud being the backbone of their devices
  • Health with Health app and associated ResearchKit and CareKit
  • Home automation with HomeKit & Home app
  • Payments with Apple Pay
  • AI whilst maintaining privacy
  • Underlying changes - with Swift as the language and then upcoming Apple File System
Besides that's what's been shown. Tim Cook has mentioned the importance of AR/VR, there are rumours of car research, TV deals etc. it amazes me you think they're doing the same thing over and over. I'd take another look.

It's also one of the fun parts of following Apple, whilst most of the other tech companies preview in public, Apple usually just releases their consumer version out to the public (often with lots of rumours and internet hype). So, many people like yourself wrongly think they're "coasting" as we don't see anything official until the reveal.
 
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Mac Fly (film)

macrumors 68000
Feb 12, 2006
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I love how Apple slightly bet analysts predictions but shares still went down on the news. Just imagine if one of Apple's main products was exploding left right and centre. Even its replacements. MacRumors members for one would be calling for a public hanging of Tim Cook in Times Square. Grading on a hockey stick curve.
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The thing is, Tim Cook and Apple had been warned for a long time about depending upon only iPhone sales.

You're right. If I were Apple I'd redesign their stores completely. I'd open source Swift. I'd do an entirely new file system and work on being the backbone of their entire cloud infrastructure. Furthermore I'd get into the smart watch and tablet markets and I'd invest heavily in further projects like a car even. And to top it off I'd make their own wearables like headphones and provide a streaming music service to compete with Spotify. But Apple would never dream of doing any of that.
 
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Nefilim

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Oct 2, 2016
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Tim Cook: Couldn't have done it without you Sammy!

That many people have lost complete confidence in Samsung - and Android - that they would switch not only brand but also OS in favour of Apple? I wonder if the OS market share will show such trends.
 
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ghost187

macrumors 6502a
Mar 18, 2010
956
2,004
That many people have lost complete confidence in Samsung - and Android - that they would switch not only brand but also OS in favour of Apple? I wonder if the OS market share will show such trends.

Yes. I'd even go as far as saying Samsung killed the headphone jack. iPhone 7 was supposed to suffer for it and the Note 7 was the top rated phone of the year. Also, the Note series is the only phone that costs more than an iPhone, sells 10s of millions, and has no equivalent in the marketplace. I'd say this is about a 10 million swing for Apple for the holiday quarter which is why Tim Cook is forcasting return to growth.
 
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maflynn

Moderator
Staff member
May 3, 2009
67,155
34,276
Boston
Ok, so while the numbers are down, Apple expects better revenue for the Christmas season?

I am fairly surprised at how popular the iPhone 7 is - my loves her 7.

Hopefully the new Macs will help things turn around.

I don't see much changes in the iPad category, I think those numbers are going to keep going down
 
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69650

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Mar 23, 2006
3,367
1,877
England
Apple will always remain vulnerable while they rely on one product to generate 60% of their sales and profits.

If they don't diversify into significant new markets then I don't see how they can continue to grow. There has to be a limit to how many iPhones they can sell every quarter. They might not necessarily continue to see sales decline but I don't see much opportunity for continued significant growth.

Of course they could always use that cash pile to buy growth companies in rapidly expanding markets. That would be the most obvious thing to do. They can't be getting much of a return on their cash assets given the low interest rates around the world.
 
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