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  • Apple: Net Income Growth Is The Name Of The Game [View article]
    sikkabooyah:

    Thank you for your comment. I remain quite bullish about Apple long-term and expect a return to positive net income growth as early as the June quarter. As the founder of the Braeburn Group of independent Apple analysts and being among the most active members of our global discussion community, I have an intense interest in all things Apple.

    No matter my bullish stance, ignoring Apple’s current performance realities would serve no useful purpose. A cogent review of the facts is the best means to promote informed discourse about Apple and the company’s prospects for long-term growth.
    Feb 23 12:46 PM | 1 Like Like |Link to Comment
  • Apple: Net Income Growth Is The Name Of The Game [View article]
    InvestingInvestor:

    Exactly which facts have been “twisted”? Apple is working through a multi-quarter cycle of negative net income growth and declining gross margin. Those are facts.

    The rates of growth in high-end smartphone unit sales on a global basis have diminished. The Apple iPad will not see anywhere near the rates of unit sales growth that occurred in the first two years following introduction of the product line.

    Contributing to the multi-quarter cycle of negative net income growth are the company’s very strong results in FY2012, the extraordinary $1.551 billion warranty set-aside realized in the March quarter one year ago and an overall change in the unit sales mix following the introduction of the iPad mini and a higher percentage of iPhone unit sales for lower-cost handsets. The iPhone unit sales mix has been influenced by efforts to gain traction in India and other emerging markets.

    Due to high import tariffs, sales in Brazil are challenged. In the December quarter, revenue in the Americas actually fell 1%. The company’s performance in the Americas was also challenged by changes in US carrier upgrade policies that have extended the time period between subsidized smartphone upgrades.

    China Telecom and China Unicom participated in the initial rollout of the iPhone 5s and iPhone 5c. This moved revenue from sales through those carriers to the recent December quarter from the March quarter. China Mobile became an authorized iPhone carrier this quarter but sales in the first year of the agreement will be influenced by the rollout of 4G/LTE on the mainland. This agreement will reveal its value long-term.

    Through the company’s March quarter guidance, Apple’s management has signaled the possibility of negative revenue growth in the current quarter. That’s not conjecture and it’s not a twisting of the facts.

    As I stated in the article, I expect a return to positive net income growth in the June quarter and improved gross margin through at least the March quarter of FY2015.

    Although I do not make stock recommendations, I consider Apple a strong investment choice for value, conservative and even growth investors moving forward. But this does not change the company’s current performance realities.

    Apple’s capital allocation plan (the return of over $100 billion in capital over four years through dividends and share repurchases) will buoy the share price. But until net income growth returns, the impact of the share repurchases on the share price will be compromised.

    Patient investors may be well rewarded over the next two years. But ignoring the company’s recent and current performance realities benefits no one.

    Again, exactly which facts have been “twisted”?
    Feb 23 12:36 PM | 8 Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    techy46:

    The challenges of establishing and successfully sustaining a third mobile device platform are immense. Extending Windows into the mobile device market will take time and a big investment of resources to make it work. So far, the results have not been impressive and the market for high-margin devices is growing much more slowly than the market for lower-cost devices.

    Apple has plenty of geography to cover for both the iPhone and iPad lines. But growth rates for the two popular products lines have slowed.
    Feb 17 07:58 PM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    ronjohn26:

    Consumers purchase Apple innovation. The seasonal nature of Apple’s unit sales and consequential revenue cycles suggest consumers begin to sit on their hands five months to months to six months after a product refresh and postpone purchases until the next refresh cycle. Maintaining a “conversation” with consumers throughout the year is important for eco-system development and customer engagement. Captivating the imagination assists in selling Apple products and encourages participation in the eco-system.
    Feb 17 07:51 PM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    tftf:

    Management had access to the numbers for a month and could have prepared better for the earnest questions from analysts. I can’t imagine it came as a surprise to management December quarter results and March quarter guidance would cause concern.

    What worked for Steve Jobs may not work for Tim Cook as Apple continues through a slow-growth/no-growth phase. A new conversation with customers, shareholders and analysts may need to begin.
    Jan 30 02:49 AM | 1 Like Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    johnanexta:

    Thank you for the thoughtful comment. I am enthralled by Apple’s migration to 64-bit SOCs and I agree iBeacon has real potential.

    I view Apple as a customer relationship continuum and I see the real value of the company in the manner in which it engages customers and builds long-term, high yield relationships.

    The 64-bit environment opens exciting opportunities for eco-system partners, enterprises customers seeking productive new technologies and devices and consumers interested in extraordinarily well designed products.

    I’m not concerned about Apple product market share but I am concerned about the pace of new customer acquisition and the size of the customer market Apple can make available to developers, content providers and eventually retailers through an Apple-based commerce system.

    While the iTunes/Software/Services revenue segment was again the company’s fastest-growing revenue segment in the December quarter, Apple’s dependence on the iPhone and iPad for over 75% of the company’s recognized revenue creates growth challenges.

    I’m interested in management providing its vision of the digital device world of tomorrow as a means to engage the company’s customers on where Apple sees the future for its products and, in broad terms, where Apple intends to take its customers and device and services platform in the quarters and years ahead.
    Jan 30 01:45 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    964500:

    Vision is providing a broad framework of where management sees the digital device world of tomorrow and how Apple is planning to address market opportunities. There was nothing mentioned in yesterday’s prepared remarks following the release of earnings and in the responses to direct and earnest questions from analysts during the conference call that suggests the company is addressing the challenges of no profit growth and the real risk of negative revenue growth in the current quarter.
    Jan 29 01:34 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    Camden:
    Why? The company is facing the real risk of the first negative revenue growth quarter in the company’s recent history and March quarter net income may be below the results of two years ago.
    Negative revenue growth in the Americas region (Apple’s largest revenue region) during the holiday quarter following the roll out of new iPhones and iPads suggests a decline in consumer interest. Of greatest value to Apple are the company’s customers. If customers are not engaged, Apple will continue to have revenue and net income growth challenges.
    Jan 29 01:25 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    DanoX:

    Again, I’m not suggesting Apple unwrap the company’s planned new products. I am suggesting management provide insight as to where the team sees the digital device world of tomorrow from the vantage point of today.

    Apple’s December quarter net income has been essential flat for successive years and March quarter guidance suggests net income may come in lower than two years ago. How would you address the real risk of the first quarter with negative revenue growth in the company’s recent history?

    I’d start with real and relevant answers to the questions asked by analysts and offer vision for the future to the company’s hundreds of millions of device and services customers.
    Jan 29 01:15 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    tftf:

    I’ve been actively following Apple for over 20 years and I’ve been a Mac user since 1986.

    I’m not suggesting management take the wraps off of new products. I am suggesting management provide vision as to where the team sees opportunities in the years ahead. Please read management’s responses to the questions posed by analysts during yesterday’s conference call.

    It wasn’t just a soft quarter that brought the stock down over $40 today. It was a soft quarter and March quarter guidance that suggests the real possibility of a year-over-year decline in recognized revenue and a net income outcome lower than the results of the March quarter two years ago.

    I consider management’s responses to questions during yesterday’s conference call to be less than satisfactory. The analysts were not hunting Apple. They were trying to make sense of soft results and surprisingly low March quarter guidance.
    Jan 29 01:05 AM | 1 Like Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    davel:

    You are correct. The migration to 64-bit SOCs is a big step forward. The iPhone 5s is an amazing smartphone handset and an extraordinary device for personal productivity.

    Apple is laying a foundation for future growth. All the more reason management needs to be more forthcoming about the company’s vision for the digital device world of tomorrow. Management can not pretend the products will speak for themselves.
    Jan 29 12:46 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    johnanexta:

    Long-term shareholders have been richly rewarded over the past sixteen years. However, the current no-growth phase may lead to a diminished earnings multiple for shareholders and little share price appreciation over the next few months even with the current $60 billion share repurchase program.

    I do have confidence in Apple’s long-term prospects for growth and I see nothing in the results that suggests those with a multi-year outlook should dump their shares.

    I am suggesting, after listening to management’s responses during the conference call with analysts, much more needs to be said about the company’s vision for new products and services. Again, I’m not suggesting management detail Apple’s next new product plans, but providing an outline of where management sees new growth opportunities would be helpful for shareholders and the analysts preparing forecasts.
    Jan 29 12:26 AM | Likes Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    John Doe12:

    There’s no disputing the fact Apple is a highly profitable company. There’s also a very high market cap awarded to Apple for all of its success.

    Based on guidance, revenue and net income in the March quarter may be lower than the outcome two years ago. I’m not suggesting Apple take the wraps off of planned new products. I am suggesting management provide a glimpse of how it sees the computing and digital device world of tomorrow while working through the no-growth phase today.
    Jan 29 12:12 AM | 1 Like Like |Link to Comment
  • Apple: Management Needs To Vision Tomorrow More Than Explain Today [View article]
    Macbeutling:

    Thank you for your comment. I have confidence in Apple’s ability to deliver long-term.
    Jan 29 12:03 AM | 1 Like Like |Link to Comment
  • Apple: It's A Matter Of What, Where And Why [View article]
    Camden:

    The ongoing share repurchase program will amplify the return to positive net income growth. I expect for the fiscal year the eps growth rate to exceed the rate of growth in revenue.
    Dec 30 11:58 PM | 2 Likes Like |Link to Comment
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