iphone is 70% of Apple's profits. iphone margins are collapsing (much like AAPL stock) as smartphones become a commodity. Wait until Apple's next earnings release... you'll see.
Collapsing? 2% is hardly collapsing. Once again, the problem is that Apple has an insanely high profit margin so it has nowhere to go but down. Still, with increased revenues, profits will be up which is the most important number of them all.
Sentiment: Strong Buy
I posted this on 08/24/12 when AAPL was at $670. Nothing has changed. Read it and weep...
A Couple Of Apple Facts That Mainstream Media Fails To Harp On:
"As is usual, I'm receiving inordinate amounts of Apple Fanboi mails and comments asking me to admit how wrong I was on Apple. Of course, these emails fail to articulate exactly what I was wrong about, or relate to what I was/am right about. Apple is a company with a heretofore unheard of cult following. If it's Apple, it can do no wrong, and anyone who disagrees is wrong. Well for investors, that is a dangerous perspective. Apple's share price has been on a tear, but its tearing in an equity market that is devoid of true fundamental market pricing. This, alone, should be enough to give the prudent man (or woman) pause. If that's not enough, there's always the commons sense perspective.
Apple is minting money, that's for sure, but it's minting money based off of a single product. That product has been been totally eclipsed in functionality by its competitors. Those competitors also happen to be Apple's primary vendors and suppliers for that very same product that Apple relies on for ~70% of its profits!!! If that's not a recipe for disappointment, I don't know what it is? This was explained fully in my post The Mobile Computing Wars Are Progressing Exactly As Anticipated - Google Is Killin' Them!!!
In 2010, I said it will probably take up to 8 quarters for the Apple competition to cause earnings misses. I believe that I was the only one to say so, and Apple has missed expectations twice in less than a year. Reporters and armchair analysts (this includes much of the sell side) have blindly swallowed Apple's mesmerizing marketing BS in chanting with the chorus... these misses stem from the unwashed masses waiting with bated breath anticipation for the next, greatest (and already obsolesced by the Android competition) iPhone model to be released. I find this bullshxt to be virtually intolerable when reiterated by would be professionals."
if apple launches a wearable computing product in next 2 years where will apple be ?
how about if apple enters payment business?
1000 thats where
phones aint going way btw even with declining margins
CUPERTINO, California—October 18, 2010—Apple® today announced financial results for its fiscal 2010 fourth quarter ended September 25, 2010. The Company posted record revenue of
$20.34 billion and net quarterly profit of $4.31 billion, or $4.64 per diluted share. These results compare to revenue of $12.21 billion and net quarterly profit of $2.53 billion, or $2.77 per diluted share, in the year-ago quarter. Gross margin was 36.9 percent compared to 41.8 percent in the year-ago quarter. International sales accounted for 57 percent of the quarter’s revenue.