Making my running notes again from the earnings report and call.....
Numbers:
- $52.6 billion in revenue, up 12% YOY
- 46.7 million iPhones sold, up 2% YOY for revenue
- 10.3 million iPads sold, up 14% YOY for revenue
- 5.4 million Macs sold, up 25% YOY for revenue
- $8.5 billion services revenue, up 34% YOY
- $3.2 billion other products revenue, up 36% YOY
- Q1 guidance: $84 to $87 billion, a record high.
- 4Q EPS $2.07, Est. $1.87
- 4Q Rev. $52.6B, Est. $50.7B
Where it came from:
- China is back to growth with 22% quarter over quarter and 12% year over year revenue growth. Europe saw the strongest year over year revenue growth, up 20%. The U.S revenues increased year over year by 14%, while the rest of the Asia Pacific increased by 5% year over year.
- Apple announces it sold 46.7 million iPhones in Q417, compared to 45.5 million units in the year-ago quarter. This is in line with expectations. This represents a year-over-year 3% unit growth and 2% revenue growth, suggesting slightly more people are buying higher priced iPhones like the 7 Plus and 8 Plus.
- Apple sold 10.3 million iPads in Q417, compared to 9.3 million units in the year-ago quarter
- for the Apple Watch, Apple Pay and Apple TV products... The 36% year-over-year growth for this category, meaning Apple Watch and AirPods sales have been strong.
- Apple announces it generated $8.5 billion in revenues on services, which includes the App Store and Apple Music, in Q417. This is 34% growth from $6.3 billion in the year-ago quarter and 17% quarter over quarter growth.
- Apple sold 5.4 million Macs in Q417, representing 10% unit growth year over year. Mac revenues are up 25% year over year
Is the reverse true for iPhones? Like even with the (granted not that many) $1,000+ iPhone X's, there was only a 2% increase in revenue, so I wonder if Apple is starting to sell more lower-end iPhones as a percentage of its total iPhone sales.
Considering that preorders just started last week and it goes on sale tomorrow, I doubt it had much of an impact. More will probably show up next quarter. I'd guess that less 8 and 8 Plus were sold due to people waiting on X. That's what I'm doing, anyways
Presumably the revenue wouldn't be recognized until the phone was shipped so the direct impact of the iPhone X would be zilch. As you say, to the degree it has an impact at all, it's probably negative as, in the short term, there would be more 8/8+ sales if there weren't an X coming in the relatively near term.
[ADDED: And as others have noted, no iPhone X sales happened anyway before the end of the quarter being reported and only about a week of iPhone 8 sales.]
True, but in the context of the parent post, "average sale price hasn't changed much", then if we assume the following:
unit price remains stable, unit sales have increased 10%, unit revenue has increased 25%, then profit has absolutely increased (and as you say, only due to a decrease in costs).
I believe you'd could get the same ratios when unit costs go down (e.g., raw materials costs drop, fixed costs such as tooling are amortized, and so forth).
It ticked up a bit recently because of the MacBook Pro with TouchBar; the iMac Pro[1] ships next month at a starting price of $4999; we know there will be a revised Mac Pro[2] in 2018 that will be similarly priced for starters but probably go significantly higher depending on the configuration.
From 2016 to 2017 they increased the price of the latest generation of MacBook Pros by a couple hundred dollars. It wasn’t so noticeable because they also added some lower spec models to the lineup in 2017. For example, a base non-touchbar 8|256 mbp in 2016 was about $1300, but about $1450 in 2017. Yet you could still get a $1300 model in 2017, it just had half the storage of the 2016 $1300 model at 128GB.
"This represents a year-over-year 3% unit growth and 2% revenue growth, suggesting slightly more people are buying higher priced iPhones like the 7 Plus and 8 Plus."
Isn't that the other way around? More units were sold, but at slightly cheaper price. If they were more expensive the revenue growth rate would be greater than 3%.
The scale of this is baffling. They earned the entire value of Tesla or Ford in profit in the past quarter. Apple's market cap has increased almost $400b in the past 18 months.
I was part of the group that thought it would be impossible to go above flat or even decrease a bit. I don't dream at Apple, but it's still impressive.
See the bigger picture by comparing Q4 2017 to Q4 2015 - that was a blow-out quarter. Sales and EPS have since declined, especially considering the vast buyback amount.
Most people I know have one, and are not looking at updating ever until it breaks. For browsing/email/facebook, you don't need the latest one. Even the iPad 2 is enough to do those tasks. I feel there's much less urgency to update than on the iPhones and the Mac.
I would've agreed with this except that my parents, who only do exactly that, decided to buy a new one because they said the old one was starting to feel slow. It's exactly as fast as it is the day I gave it to them for that kind of stuff but they went to the Apple Store to get my dad's phone serviced and they played around with one of the demo units. My dad commented on how much faster it felt and BAM, they walked away with a new iPad and a replacement iPhone (out of warranty but cheaper than a new one).
"A problem occurred with this webpage so it was reloaded, fix--blah--blah--I refuse to buy a new Apple Product until I'm better off financially--which is looking bad."
The 120 Hz screen refresh on the latest iPad is a game changer. It has surprised me how noticeable to non-techies it has been when I let them play with it.
They don't know why they like the feel and they use different words to express it, but it's real.
Not to mention iOS multitasking not available on older iPads.
Apple’s market cap is just under $900 billion dollars[1]; as crazy as it sounds, unless something totally unforeseen happens, they could be at a $1 trillion market cap a little over a year from now, after 2018's holiday quarter with a full year of iPhone 8/8+/X sales, the successor of the iPhone X, plus sales of the iMac Pro starting at $4999 each and the Mac Pro and all of the rest of lineup.
Whether they're a $1T company in that timeframe (one year) mostly depends on the strength of the U.S. dollar, given that the majority of their revenue comes from overseas.
for the Apple Watch, Apple Pay and Apple TV products... The 36% year-over-year growth for this category, meaning Apple Watch and AirPods sales have been strong.
How do you come to that conclusion? Couldn't it simply be that one of those products is selling better than a year ago?
I assume you were downvoted because the comment is not really in line with what is expected on HN. It only tangentially relates to the parent, and does not add anything substantive to the conversation.
There’s been constant whining that Apple doesn’t care about the Mac and has abandoned the platform, the line is stagnating and they don’t sell any models anybody wants to buy because they’re all terrible and everybody will buy big ass Windows laptops with proper keyboards, 32GB RAM and an escape key for EMACS.
Except for actual customers that are buying Macs by the truckload, that is.
Yes that was Microsoft all the way into the 2000s. Power users are the canary in the coalmine. Once you lose them they are gone. With power users gone your computing problem devolves to creating common denominator apps / platforms. Lack of interesting work eventually catches up with the company since it becomes progressively harder to hire top talent since there is no compelling "mission" or "vision" anymore.
Having thought about this, I guess there are different concepts here
a. Apple as a business
b. Apple as a force that shapes the future of computing
By any metric they are doing a great job of a, on the second I think they could do a lot more.
Interesting comment, I can see that is a reasonable concern. But where are power users going to go? Windows has been a mess for a full decade now. Microsoft’s management of the platform has been a joke. Maybe they’re turning a corner with it, but maybe not. It’s really hard to say. There are some real concerns with the Mac hardware, but whereas with the OS there’s one version and that’s it, for hardware they always have a range of options available and can experiment on certain lines while still offering an alternative. It’s a lot harder to pivot the OS the same way.
To be honest, there is no compelling alternative out there at the moment. The only possible contenders currently if they are to ever materialize are Google and Microsoft (Companies that have a proven track record of doing both software and hardware at Apples scale). Chances of someone coming up and beating Apple at their current game seem unlikely. What is likely however is that some one comes up with a better and more compelling definition of "computing" and Apple fails to react to that in a timely manner because they are too busy working on a thinner version of their current hardware lineup.
Losing Chris Lattner was a real shame on that score, but Apple does seem to be an organisation that can walk and chew gum at the same time. They have top flight hardware guys and top flight software guys and I don't see the software guys losing focus because of something the hardware guys are doing. On the contrary the two sids of the business seems to constantly challenge each other push the envelope that bit further.
There are risks. They don't seem to think AR or VR headsets are worth pursuing. I happen to think they are right and they are correctly avoiding an expensive and distracting technological cul de sac, but one of these days there is a chance they will call something like that wrong and miss something important.
Because it could mean that sophisticated markets are not impressed by the stagnating offering and the only reason the Mac is seeing growth is that people are buying Macs for the first time in developing countries.
That being said, they just said on the call that all geographic areas grew by at least 20% in Mac sales so maybe I was reading too much into Tim Cook's earlier comment.
It's certainly filled with people who have never used Macs. You have to take that into account when using global growth to try to predict future US growth.
Mac usage is a metric for sophistication? What a silly set of comments. People seem to grossly underestimate China. That hubris will only hurt you in the long run. Half or more of the stuff in those “sophisticated” computers is sourced in China.
I think you're reading the wrong meaning into this particular word. I would take the term 'sophisticated market' to refer to a market that is established and has largely passed the initial saturation phase. There will a number of different actors in the market competing on axes other than "who can offer the most product for the least money," with more complexity in trade as participants' marketing and sales strategies evolve, or as consumer behaviour starts to be affected by other forces.
In this sense, China is a less sophisticated market – that's not a problem or a negative, it's just a different stage of market development. It's reasonable to point out that sales behaviour will be different for that market as a result.
People don't tend to be equally sophisticated buyers across all product categories. Mac usage is definitely a metric for buyer sophistication, when we're talking about Mac sales!
China has 3x as many internet users as the US. India also has more internet users. So yeah, percentage wise they may be lower, but that's still a billion folks between those two countries alone.
Yeah, and rural Indians have to use peer-to-peer networks to download their apps because service is so spotty and expensive. That's materially different from an "internet user" in Western Europe or Japan or the United States.
They dropped the ball on the MacPro but everything else saw evolutionary upgrades this year.
The MacBook Pro is the 2nd generation of this design which usually see more people upgrading to. And to be fair it's a dramatic upgrade over older models.
For example- everyone I know with one LOVES the new keyboard. Myself included: for me it’s the best laptop keyboard I’ve used, period.
That alone tears your point apart but it’s also telling that you picked 2015 (one of the peak sales years for Macs in the last decade). You either deliberately intended to mislead or you just don’t actually understand how market fluctuations work.
Anecdotal, but my brand new late 2016 Macbook Pro developed a stuck key within a few weeks of starting to use it. I only used it on my desk at work and didn't take it to the beach or something crazy. This is not an imaginary problem.
Sometimes they pass power through, sometimes they don’t. Some are thunderbolt, some aren’t. Try getting a monitor to work with peripherals plugged into the monitor and have the laptop charge. It is a pretty incredible corner that Apple have painted themselves into. https://marco.org/2017/10/14/impossible-dream-of-usb-c
I'll never understand this. The pattern is the same every year. They announce a product, "journalists" say it's a failure, they sell more units and make more money than ever before, and the cycle repeats. Apple will definitely drop the ball someday but I think people are a little too quick to make that call. I realize most of that is in the never-ending quest for clickbait but still...
Oh absolutely (and not just journalists, but all the Apple-haters). Every year since at least 1984, "Apple hasn't come out with a new product in _weeks_! They're doooomed!"
Every single year. For at least 30 years. "Dooooooomed!"
In their defense, it was very nearly doomed for 10-15 of those years :-P
But I agree, anyone who has said this since 2007 clearly isn't paying attention. Almost all the people with iPhones are going to keep buying a new iPhone every 2 years for a long long time.
Well, I do think that Touchbar is an absolutely awful gimmicky product.
The design is baffling : you lose tactile feedback on the function keys and even the nice additions have had zero thoughts put into them (for example the lock key sounds like a good idea but in practice is extremely annoying since I hit up accidentaly 2/3 of the time .. it would have been easy to make it a slide to activate button).
The thing is : unlike what the pro monicker suggests, I am not at all the target of this product. So while it is objectively worse in all the criterias that matter to me, it does not matter to apple sales.
I’m not sure what gp was talking about. The TouchID sensor also doubles as a physical power button(or a sleep if pressed briefly). It is a physical button too, not like the iPhone ⅞ buttons.
Yeah... I'm aware of that which is what made OP confusing. They're either talking about the Power/TouchID button (which is still physical as it has been on every other MacBook prior) or they purposely added a "Lock" button to the TouchBar and are complaining about something they added that isn't there by default.
>complaining about something they added that isn't there by default
it is part of the OS, not a third party app.
So I think that complaining that it is badly designed is fair.
I can complain about the default configuration too if you want.
It takes away the function keys I actually need and replaces them with a screen. The lack of tactile feedback is really annoying. Even after configuring the touchbar to display the function keys by default in my IDE, it still bugs me and make me 'mistype' more than ever on this strip.
It's not badly designed, though. It's a button on the TouchBar just like any other. If OP is accidentally hitting it all the time then they added it in a poor location. I have a completely customized TouchBar (thanks to Better Touch Tool) and I have never accidentally hit a button. He's blaming the hardware for user error.
So then you purposely added that to the TouchBar or you're unintentionally hitting the power button that is in the exact same place as it was on all previous MacBooks and that's somehow an issue with the TouchBar?
I added it to the touchbar : my laptop is connected to a larger screen, so if I close the lid, it just switch to 'external display only mode'.
With this button, I can close my seesion in one tap.
however I hit it accidentally way too often. I myst hit it accidentally at least as much as purposefully.
I have a question. What are the "Services" they refer to in the article? Are these B2B and/or government contracts, the kind which Oracle/IBM are well-known for?
The last time I heard that number leak (admittedly been a while), that was "only" in the single digit billions per year. The services category did $8.5B in the past quarter.
year-over-year 3% unit growth for iPhone units. So generally are we at the end of mobile absorption by humanity and mobile growth? From now on instead of market growth shall we see market share competition? Apple is lucky to sell more expensive iPhones and better margins with better ASP. Carriers are still the big driver by bundled tariffs and that helps high end smartphone sales.
End of growth is not end of absorption. Still 40 to 50 M phones sold every quarter... I think seeing everything through the financial growth lens really keeps us from grasping how steadily a stagnating Apple would still be physically growing.
Not true. Its a status symbol. Which means it allows ppl to signal they are breaking class/caste barriers when they buy one. That's a big thing in the developing world.
Walt Mossberg
@waltmossberg
Perspective: Mac revenues alone in Apple’s qtr just released were $7+ billion. At an annual rate, that would put the Mac in the Fortune 100.
If they do a quarter like this past one for macs for the upcoming three quarters then Mac sales would be on the cusp of being in the Fortune 100, not just in the 500!
The company's management has an obligation to the company's owners to pursue all legal means to reduce their tax obligation. You better believe the IRS would have come knocking already if they were doing anything illegal by keeping that $269B outside of the U.S.
I’m sure you would find Apple pays plenty in American taxes. 35% is a huge haircut to take on money earned outside the United States. The shareholders would correctly be out for blood.
>I’m sure you would find Apple pays plenty in American taxes.
I found Apple incorrectly reports to investors taxes paid.
"For example, in fiscal year 2011, on its 10-K reports filed with the U.S. Securities and Exchange Commission, Apple said it paid $6.9 billion in taxes to the U.S. government, but on its tax return filed with the U.S. Internal Revenue Service, it reported taxes due of $2.5 billion, the report said."
So yeah, I'm sure you think they pay a lot of money.
>35% is a huge haircut to take on money earned outside the United States.
30% is a huge haircut to take on money earned outside the app store, but Apple still demands that too. Suddenly Apple's in favor of taxes. Developer taxes.
What’s more likely? That the SEC ignored Apple blatantly lying to shareholders or that the Senate subcommittee doesn’t actually understand how corporate taxes work?
Given that I cannot find any follow-up to that story, I don’t know which if either is correct, but I am skeptical.
Alternately, how about the US not have absurd laws taxing money made in other countries? This is not a normal thing and most countries don't work this way. If we had sane tax laws, Apple (and ever other multi-national company that works exactly the same way) would bring the money back and put it to work in the US
I think that the point being made here is that it isn't entirely clear why the obligation to the company's owners should override the obligation to the country most of its employees live in.
I go back and forward on this - I find some elements of it convincing but others not.
Either way, I do think that the argument should be presented fairly, and it does seem fair to point out that the legal obligation to the shareholders is defined and enforced by the laws of the country.
It doesn't make sense to talk about the shareholder obligation without the acknowledgement that obligation is a construct, and perhaps there is a transitive obligation to the entity which created and enforces that obligation.
It is entirely reasonable to consider if that obligation should change (the law is a construct after all) to include other obligations.
The obligation to the country is to follow the law and pay the taxes the law requires. which they do. Do you avoid taking deductions and send the IRS more than is required each year? Why, just because Apple makes a lot of money, do we expect them to pay more than the law requires of them? That's just absurd.
> As I said, I'm not entirely convinced, but nor is it an absurd view.
It is an absurd view to think that people and/or companies are morally obligated to pay taxes above and beyond their legal obligations.
Paying taxes competes with a person's ability to provide for themselves and their family. To think that a person has an obligation to give extra money to strangers, beyond their legal obligation—which we as a society have collectively agreed upon—rather than keeping that money for themselves and their family is absurd. And, to anticipate where you may go with this: while Apple may be a hugely profitable company, those profits belong to the owners of the company, who are ultimately people who need to provide for themselves and their families.
Well, the EU commission has come knocking, and determined that schemes that Apple tried to sell as perfectly legal tax avoidance were, in fact, illegal tax evasion.
How is this narrative still around? It only takes a few minutes of searching to find out that Apple pays more US tax than almost any other corporation in the country (just a couple oil companies pay more). Apple pays $16B of the total $450B the US collects from all companies. Total US tax receipts are ~2.2T.
No, they pay exactly what they owe. It is in fact their job to follow the law and find ways to pay as little taxes as possible under the law, which is what they do.
The way it works is, in the USA they tell them they earn this much, in jurisdiction B they tell them they earn that much. Jurisdiction B says "Oh well the majority, Y% of your value is created in the USA so we won't tax you on Y%". So jurisdiction B forgoes that Y% tax, and then the USA doesn't tax it either, and that then goes onto the bottom line!
Now, you could say, that's Jurisdiction B's business, but it doesn't undermine the fact that they save a huge amount of tax off their profits courtesy of Jurisdiction B, and this has a highly significant effect on their earnings.
What gets really interesting is if Jurisdiction B is part of a larger "Bloc E". They can effectively do business in Bloc E at a highly discounted rate relative to competitors, and even native businesses, and other members of Bloc E start to complain.
Who loses out here? Everybody but the tax efficient "Company A" and a bunch of insiders in Jurisdiction B.
Tax avoidance is the moral equivalent of draft dodging. Dodgers don't participate in the war their wealthy parents started.
Maybe some day the spaceship catches fire and burns to the ground with everyone trapped inside, because the fire dept was ironically unfunded due to lack of tax revenue. I won't feel sorry for them if that happens, as they will have deserved it.
Imagine how much personal income tax Apple’s 100,000+ employees pay, accross all jurisdictions, and all the VAT tax collected for their products sold around the world.
This site is pretty good at sniping comments that would pass a 'is this reddit quality?' discriminator on generic NLP but I think the underlying idea is interesting under the context of 'what now brown cow?' Elon Musk has done his job getting EVs kickstarted. I suspect he's happy to move along and work on tunnels and rockets. Tesla principally needs some capital security, some quality tech managers and bench, and some just plain maturity in investor relations. The two would do pretty well in brand alignment in general. Apple needs, on a shareholder concern basis, to find markets of large enough size to matter, and Tesla has its toes in some extremely large markets. Anyway that's the hypothesis for those that want to ponder 'how does Apple do something other than make iPhones'. Thanks for the downvotes anyway, bots.
So Apple's effective tax rate is 23%. Honestly that's better than I expected, but still less than it should be. Federal corporate income tax is 35% and California adds 8.84%. So there are other California companies which pay almost twice as much tax as Apple.
(Keep in mind that almost all of the value created by Apple is created in California. If Apple were to outsource all their sales and be a purely Californian company then it would make almost the same amount of pre-tax profit)
> So Apple's effective tax rate is 23%. ... Honestly that's better than I expected, but still less than it should be. ... Federal corporate income tax is 35%
That's misleading. You're comparing their global effective tax rate versus the US Federal rate. The question is how much did Apple pay in taxes in the US, on US-based profits.
23% isn't less than it should be, it's extremely reasonable compared to rates around the world. The OECD average statutory corporate income tax rate is around 24% (the effective rate is even lower).
The average effective corporate income tax rates for 2012: UK, 10%; Germany, 14%; Canada, 16%; Australia, 17%; China, 19%; France, 20%; South Korea, 20%.
Even Scandinavian nations like Finland (20%) or Sweden (22%) have lower statutory rates (to say nothing of the effective). Denmark has a reputation for having a government spending rate that is among the highest on earth among developed nations as a share of its economy, and its statutory rate is merely 24.5%.
My point is that almost all of Apple's profit is in reality generated in California, even if its sales and accounting profits are booked overseas. So I'm comparing US-based profit with the US Federal tax rate.
Let's say an iPhone is sold in the UK, generating a $200 profit. How much of that profit was really generated in the UK and how much in the US? The answer is to consider what would happen if Apple's US and UK operations were two distinct, independent companies: Apple in California would determine almost everything about the way iPhones are sold in the UK - where the Apple stores are located, what the stores look like, what their TV and billboard advertising should look like, what happens when a customer returns a product, etc. Apple US would then take this list of requirements and negotiate with a UK business partner. In that negotiation the UK partner has very little leverage - if the UK partner doesn't like terms Apple US is offering, Apple US can just find another partner. The UK partner then sells phones according to Apple's specification. The result is that the UK partner will have thin margins and almost all profit will flow back to the US.
Unfortunately, tax law allows Apple to move its intellectual property to an Irish subsidiary company. The profit on UK sales is then booked in Ireland and Apple pays the low Irish tax rate even though the real profit has been generated in the US.
I accept your point that 23% may be a good corporate tax rate - but in that case it should be 23% for all Californian companies, not just the ones which are able to transfer their IP offshore.
I think the difficulty with corporation tax for global corporations is that asking where profits are generated is not the only relevant question.
You could also ask who bears the cost of generating those profits. Where did Apple's employees grow up and go to school before they joined Apple in California? Who builds the infrastructure for manufacturing and distributing Apple's products?
So the global distribution of value generation and the global distribution of cost can vary significantly. In fact, Apple is a relatively simple case compared to, say, Amazon.
Of course, this doesn't make the sort of "tax planning" you're talking about any less problematic. On the contrary.
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[ 3.0 ms ] story [ 277 ms ] threadNumbers:
- $52.6 billion in revenue, up 12% YOY
- 46.7 million iPhones sold, up 2% YOY for revenue
- 10.3 million iPads sold, up 14% YOY for revenue
- 5.4 million Macs sold, up 25% YOY for revenue
- $8.5 billion services revenue, up 34% YOY
- $3.2 billion other products revenue, up 36% YOY
- Q1 guidance: $84 to $87 billion, a record high.
- 4Q EPS $2.07, Est. $1.87
- 4Q Rev. $52.6B, Est. $50.7B
Where it came from:
- China is back to growth with 22% quarter over quarter and 12% year over year revenue growth. Europe saw the strongest year over year revenue growth, up 20%. The U.S revenues increased year over year by 14%, while the rest of the Asia Pacific increased by 5% year over year.
- Apple announces it sold 46.7 million iPhones in Q417, compared to 45.5 million units in the year-ago quarter. This is in line with expectations. This represents a year-over-year 3% unit growth and 2% revenue growth, suggesting slightly more people are buying higher priced iPhones like the 7 Plus and 8 Plus.
- Apple sold 10.3 million iPads in Q417, compared to 9.3 million units in the year-ago quarter
- for the Apple Watch, Apple Pay and Apple TV products... The 36% year-over-year growth for this category, meaning Apple Watch and AirPods sales have been strong.
- Apple announces it generated $8.5 billion in revenues on services, which includes the App Store and Apple Music, in Q417. This is 34% growth from $6.3 billion in the year-ago quarter and 17% quarter over quarter growth.
- Apple sold 5.4 million Macs in Q417, representing 10% unit growth year over year. Mac revenues are up 25% year over year
Do you have the units sold YOY?
The interesting part is the fluctuations in the past years. Looks like people are buying when new hardware is released.
[ADDED: And as others have noted, no iPhone X sales happened anyway before the end of the quarter being reported and only about a week of iPhone 8 sales.]
unit price remains stable, unit sales have increased 10%, unit revenue has increased 25%, then profit has absolutely increased (and as you say, only due to a decrease in costs).
That alone doesn’t tell us anything about whether profit went up or down.
It ticked up a bit recently because of the MacBook Pro with TouchBar; the iMac Pro[1] ships next month at a starting price of $4999; we know there will be a revised Mac Pro[2] in 2018 that will be similarly priced for starters but probably go significantly higher depending on the configuration.
[1] https://www.apple.com/imac-pro/specs/
[2] https://www.macworld.co.uk/news/mac/new-mac-pro-2018-latest-...
So the average selling price and units will continue to increase due to the pent-up demand for pro-level Macs.
Except for the iPhone, the Mac generates more revenue than any other single product Apple sells.
Isn't that the other way around? More units were sold, but at slightly cheaper price. If they were more expensive the revenue growth rate would be greater than 3%.
Holy shit.
They don't know why they like the feel and they use different words to express it, but it's real.
Not to mention iOS multitasking not available on older iPads.
Apple’s market cap is just under $900 billion dollars[1]; as crazy as it sounds, unless something totally unforeseen happens, they could be at a $1 trillion market cap a little over a year from now, after 2018's holiday quarter with a full year of iPhone 8/8+/X sales, the successor of the iPhone X, plus sales of the iMac Pro starting at $4999 each and the Mac Pro and all of the rest of lineup.
[1]: https://ycharts.com/companies/AAPL/market_cap#recessions=fal...
Apple routinely adjusts their pricing based on the strength or weakness of the dollar.
On the quarterly conference call with analysts, Apple talks about their hedging programs against exchange rate fluctuations.
How do you come to that conclusion? Couldn't it simply be that one of those products is selling better than a year ago?
Except for actual customers that are buying Macs by the truckload, that is.
My heavy emacs use is the reason I didn't mind getting the touch bar. It's vim users I'd expect to be annoyed...
Having thought about this, I guess there are different concepts here
a. Apple as a business b. Apple as a force that shapes the future of computing
By any metric they are doing a great job of a, on the second I think they could do a lot more.
There are risks. They don't seem to think AR or VR headsets are worth pursuing. I happen to think they are right and they are correctly avoiding an expensive and distracting technological cul de sac, but one of these days there is a chance they will call something like that wrong and miss something important.
That being said, they just said on the call that all geographic areas grew by at least 20% in Mac sales so maybe I was reading too much into Tim Cook's earlier comment.
In this sense, China is a less sophisticated market – that's not a problem or a negative, it's just a different stage of market development. It's reasonable to point out that sales behaviour will be different for that market as a result.
They dropped the ball on the MacPro but everything else saw evolutionary upgrades this year.
The MacBook Pro is the 2nd generation of this design which usually see more people upgrading to. And to be fair it's a dramatic upgrade over older models.
The fact is that Mac sales are growing which contradicts your opinion.
And as the owner of a MacBook Pro 2015 and 2017 which I both use everyday I would disagree with your opinion.
That is not accurate. The MBP keyboard, for example, is objectively worse, both ergonomically and due to quality control issues.
https://9to5mac.com/2017/02/21/macbook-pro-keyboard-problems...
https://daringfireball.net/linked/2017/10/17/johnston-macboo...
"The fact is that Mac sales are growing which contradicts your opinion."
This is a non sequitur. Popularity is not a definitive measure of quality.
Beyond that, Mac sales are down from 2015 in every single quarter.
Q1 5519 5312 5374 Q2 4563 4034 4199 Q3 4796 4252 4292 Q4 5709 4886 5386
https://www.statista.com/statistics/263444/sales-of-apple-ma...
https://www.apple.com/newsroom/pdfs/fy17-q4/Q4FY17DataSummar...
For example- everyone I know with one LOVES the new keyboard. Myself included: for me it’s the best laptop keyboard I’ve used, period.
That alone tears your point apart but it’s also telling that you picked 2015 (one of the peak sales years for Macs in the last decade). You either deliberately intended to mislead or you just don’t actually understand how market fluctuations work.
Apple's Mac sales are around
• 7% in worldwide units (up from 2% at it's nadir two decades ago)
• 15-20% of worldwide PC revenues
• >50% of the entire PC industry profits.
There needs to be a term for the feeling you get when watching MacBook owners trying to work out which of the identical looking plugs will work.
Every single year. For at least 30 years. "Dooooooomed!"
But I agree, anyone who has said this since 2007 clearly isn't paying attention. Almost all the people with iPhones are going to keep buying a new iPhone every 2 years for a long long time.
Apple did buy out NeXT, but then Steve Jobs and his team took ownership over Apple key positions from inside.
A situation that happens quite often where the bought company, manages to own the buyer.
So on the paperwork and bank transactions, Apple bought NeXT, on management level, NeXT bought Apple.
The thing is : unlike what the pro monicker suggests, I am not at all the target of this product. So while it is objectively worse in all the criterias that matter to me, it does not matter to apple sales.
it is part of the OS, not a third party app. So I think that complaining that it is badly designed is fair.
I can complain about the default configuration too if you want. It takes away the function keys I actually need and replaces them with a screen. The lack of tactile feedback is really annoying. Even after configuring the touchbar to display the function keys by default in my IDE, it still bugs me and make me 'mistype' more than ever on this strip.
I used to have very hacky scripts in order to enable this feature, and this awful touchbar button is even worse.
Good that it is finally implemented ! Weird that it took so long but it is finally here.
Thanks for the tip !
Not sure what percentage that is, but I've seen it mentioned several times. Not sure about what else is included.
https://en.wikipedia.org/wiki/IBM_Mobile
Is Walt correct on this?
http://fortune.com/fortune500/list/
The company's management has an obligation to the company's owners to pursue all legal means to reduce their tax obligation. You better believe the IRS would have come knocking already if they were doing anything illegal by keeping that $269B outside of the U.S.
You've reversed cause and effect. They keep the money outside the U.S. to legally avoid the taxes. They can't bring it back.
They'd rather horde the cash than contribute Apple's fair share to the country that made Apple's success possible. Deplorable.
I found Apple incorrectly reports to investors taxes paid.
"For example, in fiscal year 2011, on its 10-K reports filed with the U.S. Securities and Exchange Commission, Apple said it paid $6.9 billion in taxes to the U.S. government, but on its tax return filed with the U.S. Internal Revenue Service, it reported taxes due of $2.5 billion, the report said."
https://www.infoworld.com/article/2614464/techology-business...
So yeah, I'm sure you think they pay a lot of money.
>35% is a huge haircut to take on money earned outside the United States.
30% is a huge haircut to take on money earned outside the app store, but Apple still demands that too. Suddenly Apple's in favor of taxes. Developer taxes.
Given that I cannot find any follow-up to that story, I don’t know which if either is correct, but I am skeptical.
Note the difference between 'tax avoidance' and 'tax evasion'.
Tax avoidance is not illegal. Tax evasion is illegal.
I go back and forward on this - I find some elements of it convincing but others not.
Either way, I do think that the argument should be presented fairly, and it does seem fair to point out that the legal obligation to the shareholders is defined and enforced by the laws of the country.
It doesn't make sense to talk about the shareholder obligation without the acknowledgement that obligation is a construct, and perhaps there is a transitive obligation to the entity which created and enforces that obligation.
It is entirely reasonable to consider if that obligation should change (the law is a construct after all) to include other obligations.
As I said, I'm not entirely convinced, but nor is it an absurd view.
Also, I hate the HN rate limit which applies when I get voted down. It makes it hard to argue the point.
It is an absurd view to think that people and/or companies are morally obligated to pay taxes above and beyond their legal obligations.
Paying taxes competes with a person's ability to provide for themselves and their family. To think that a person has an obligation to give extra money to strangers, beyond their legal obligation—which we as a society have collectively agreed upon—rather than keeping that money for themselves and their family is absurd. And, to anticipate where you may go with this: while Apple may be a hugely profitable company, those profits belong to the owners of the company, who are ultimately people who need to provide for themselves and their families.
No mention of unpopular or uncommon.
It's not about what you pay. It's about what you owe. In Apple's case, Apple owes a lot more than it pays. Tax avoidance == leeches.
Tax avoidance/evasion by multinationals in Europe was insane. Fortunately the EU is now cracking down on that.
Now, you could say, that's Jurisdiction B's business, but it doesn't undermine the fact that they save a huge amount of tax off their profits courtesy of Jurisdiction B, and this has a highly significant effect on their earnings.
What gets really interesting is if Jurisdiction B is part of a larger "Bloc E". They can effectively do business in Bloc E at a highly discounted rate relative to competitors, and even native businesses, and other members of Bloc E start to complain.
Who loses out here? Everybody but the tax efficient "Company A" and a bunch of insiders in Jurisdiction B.
Maybe some day the spaceship catches fire and burns to the ground with everyone trapped inside, because the fire dept was ironically unfunded due to lack of tax revenue. I won't feel sorry for them if that happens, as they will have deserved it.
Those leeches!
“They instantly became our two most popular iPhone models and have been every week since then.”
Shows how the press is extremely focused on buzz. Doom predictions sell.
Income tax: $3.2 billion
So Apple's effective tax rate is 23%. Honestly that's better than I expected, but still less than it should be. Federal corporate income tax is 35% and California adds 8.84%. So there are other California companies which pay almost twice as much tax as Apple.
(Keep in mind that almost all of the value created by Apple is created in California. If Apple were to outsource all their sales and be a purely Californian company then it would make almost the same amount of pre-tax profit)
That's misleading. You're comparing their global effective tax rate versus the US Federal rate. The question is how much did Apple pay in taxes in the US, on US-based profits.
23% isn't less than it should be, it's extremely reasonable compared to rates around the world. The OECD average statutory corporate income tax rate is around 24% (the effective rate is even lower).
The average effective corporate income tax rates for 2012: UK, 10%; Germany, 14%; Canada, 16%; Australia, 17%; China, 19%; France, 20%; South Korea, 20%.
Even Scandinavian nations like Finland (20%) or Sweden (22%) have lower statutory rates (to say nothing of the effective). Denmark has a reputation for having a government spending rate that is among the highest on earth among developed nations as a share of its economy, and its statutory rate is merely 24.5%.
Let's say an iPhone is sold in the UK, generating a $200 profit. How much of that profit was really generated in the UK and how much in the US? The answer is to consider what would happen if Apple's US and UK operations were two distinct, independent companies: Apple in California would determine almost everything about the way iPhones are sold in the UK - where the Apple stores are located, what the stores look like, what their TV and billboard advertising should look like, what happens when a customer returns a product, etc. Apple US would then take this list of requirements and negotiate with a UK business partner. In that negotiation the UK partner has very little leverage - if the UK partner doesn't like terms Apple US is offering, Apple US can just find another partner. The UK partner then sells phones according to Apple's specification. The result is that the UK partner will have thin margins and almost all profit will flow back to the US.
Unfortunately, tax law allows Apple to move its intellectual property to an Irish subsidiary company. The profit on UK sales is then booked in Ireland and Apple pays the low Irish tax rate even though the real profit has been generated in the US.
I accept your point that 23% may be a good corporate tax rate - but in that case it should be 23% for all Californian companies, not just the ones which are able to transfer their IP offshore.
You could also ask who bears the cost of generating those profits. Where did Apple's employees grow up and go to school before they joined Apple in California? Who builds the infrastructure for manufacturing and distributing Apple's products?
So the global distribution of value generation and the global distribution of cost can vary significantly. In fact, Apple is a relatively simple case compared to, say, Amazon.
Of course, this doesn't make the sort of "tax planning" you're talking about any less problematic. On the contrary.
But of course that doesn't answer the tricky question of who should get what share of corporate taxes paid by global corporations.