Thank you for your comments. I will be focusing on Apple's fundamental strengths and current challenges in articles to be published over the next few months.
I expect Apple's next era of strong growth to be sourced from a series of global and regional disruptive steps. Both new devices and new services factor into the mix.
My favorite axiom is:
Apple doesn't sell devices. Apple creates customer relationships and these customer relationships sell Apple's products.
Thank you for your comment. Revenue and earnings growth will move the share price higher. Understanding the underpinnings of Apple's next era of success is essential to understanding why the shares will rise in price.
I expect growth to be sourced from a series of disruptive steps to be announced over the next twelve months. Viewing Apple as an eco-system rather than as a device maker provides for a much different long-term valuation model.
The share repurchase program will no doubt provide support for the share price. Management's decision to announce the repurchase program at this time will move attention away for the recent preoccupation with the company's cash pile and focus more attention on the new products and services the company will unveil over the next twelve months.
It's apparent from my point of view Apple is planning a series of disruptive steps that include new device lines and new services. I see Apple as much more of an eco-system than a maker of digital devices.
Thank you for your comment. In my view Apple is positioning to disrupt multiple global and regional markets over the next eight quarters. From the development and installation of new tactical data centers, new retail distribution partners in emerging markets, rising capex investments and expanding component supply contracts, the next two years may be among the most prolific periods for new products in Apple's history.
The title was taken from the arts but not the work of Mr. Dylan. It's my view financial analysis is both a science and an art form. Many lessons can be taken from the arts and much can be learned from the observation of nature.
I'll be carefully watching the cost of warranty claims over the next few quarters. It's possible Apple could recapture a portion of the March quarter's $1.551 billion product warranty accruals if actual warranty claims come in lower than expected.
$414 million of the amount accrued is associated with product sales in prior quarters. Cost of warranty claims in the March quarter was $847 million versus $464 million in the prior-year period.
Apple may increase its product warranty accruals going forward, but device sales in prior periods may no longer be a factor.
March quarter revenue came in higher than I expected. But 11.6 million iPhones in the channel will have to worked down in the June quarter. I'm not seeing positive earnings growth this quarter. I'll have more after reading through the FQ3 filing.
Finding opportunities that are currently overlooked by the market is an effective approach to investing. Knowledge and patience are among a small investor's most potent and important resources. Valuations are not always rational.
Apple is offering iPhone purchase financing programs in select markets in conjunction with local banks. Regional approaches to purchase subsidies and contract incentives will vary.
In the case of China Mobile, the carrier is racing to play catch up on the installation of more modern cellular infrastructure. Apple is an eco-system more than a device maker. There's little value to Apple in selling lower-margin handsets just to sell more units.
Apple can offer a lower-cost device to expand the company's presence in select emerging markets. But I don't expect a lower-cost handset to be a compromise on build quality or a handset with a diminished useful life. Post-purchase revenue opportunities are important to Apple no matter where a handset is sold.
Apple's two fastest growing regions are Greater China and Japan. The rate of growth in Greater China has already begun to moderate. The challenges in Europe are factored into my estimates.
Along with the macroeconomic factors, consumers, in my view, are changing their approach to personal technology purchases as the pace of innovation in the smartphone market begins to slow. The global smartphone market is rapidly approaching a mature market phase.
Apple: There And Back Again [View article]
Thank you for your comment. I will be presenting additional coverage of Apple in a similar content format over the next several months.
Apple: There And Back Again [View article]
Thank you for your comments. I will be focusing on Apple's fundamental strengths and current challenges in articles to be published over the next few months.
Apple: There And Back Again [View article]
I expect Apple's next era of strong growth to be sourced from a series of global and regional disruptive steps. Both new devices and new services factor into the mix.
My favorite axiom is:
Apple doesn't sell devices. Apple creates customer relationships and these customer relationships sell Apple's products.
Apple: There And Back Again [View article]
Thank you for your comment. Revenue and earnings growth will move the share price higher. Understanding the underpinnings of Apple's next era of success is essential to understanding why the shares will rise in price.
I expect growth to be sourced from a series of disruptive steps to be announced over the next twelve months. Viewing Apple as an eco-system rather than as a device maker provides for a much different long-term valuation model.
Apple: There And Back Again [View article]
The share repurchase program will no doubt provide support for the share price. Management's decision to announce the repurchase program at this time will move attention away for the recent preoccupation with the company's cash pile and focus more attention on the new products and services the company will unveil over the next twelve months.
Apple: There And Back Again [View article]
Thank you for your comment. There's much more to write over the next few months as Apple positions itself for the company's next era of success.
Apple: There And Back Again [View article]
As I stated in the article, Apple is only ending a chapter of a long-term success story. Thank you for your comment.
Apple: There And Back Again [View article]
It's apparent from my point of view Apple is planning a series of disruptive steps that include new device lines and new services. I see Apple as much more of an eco-system than a maker of digital devices.
Apple: There And Back Again [View article]
Thank you for your comment. In my view Apple is positioning to disrupt multiple global and regional markets over the next eight quarters. From the development and installation of new tactical data centers, new retail distribution partners in emerging markets, rising capex investments and expanding component supply contracts, the next two years may be among the most prolific periods for new products in Apple's history.
Apple: There And Back Again [View article]
The title was taken from the arts but not the work of Mr. Dylan. It's my view financial analysis is both a science and an art form. Many lessons can be taken from the arts and much can be learned from the observation of nature.
Apple: There And Back Again [View article]
I'll be carefully watching the cost of warranty claims over the next few quarters. It's possible Apple could recapture a portion of the March quarter's $1.551 billion product warranty accruals if actual warranty claims come in lower than expected.
$414 million of the amount accrued is associated with product sales in prior quarters. Cost of warranty claims in the March quarter was $847 million versus $464 million in the prior-year period.
Apple may increase its product warranty accruals going forward, but device sales in prior periods may no longer be a factor.
Apple's March Quarter Madness [View article]
March quarter revenue came in higher than I expected. But 11.6 million iPhones in the channel will have to worked down in the June quarter. I'm not seeing positive earnings growth this quarter. I'll have more after reading through the FQ3 filing.
Apple's March Quarter Madness [View article]
Apple's March Quarter Madness [View article]
In the case of China Mobile, the carrier is racing to play catch up on the installation of more modern cellular infrastructure. Apple is an eco-system more than a device maker. There's little value to Apple in selling lower-margin handsets just to sell more units.
Apple can offer a lower-cost device to expand the company's presence in select emerging markets. But I don't expect a lower-cost handset to be a compromise on build quality or a handset with a diminished useful life. Post-purchase revenue opportunities are important to Apple no matter where a handset is sold.
Apple's March Quarter Madness [View article]
Apple's two fastest growing regions are Greater China and Japan. The rate of growth in Greater China has already begun to moderate. The challenges in Europe are factored into my estimates.
Along with the macroeconomic factors, consumers, in my view, are changing their approach to personal technology purchases as the pace of innovation in the smartphone market begins to slow. The global smartphone market is rapidly approaching a mature market phase.