Seeking Alpha

No Apple capital allocation changes before 2014, shares pare losses

  • Tim Cook states on Apple's (AAPL) FQ4 CC any changes to his company's capital allocation plan will be announced early next year. The comments arrive as Carl Icahn clamors for a new $150B buyback.
  • Cook also discloses Apple made 15 acquisitions in FY13. Only eight of those purchases have been identified thus far.
  • iPhone channel inventory stood at 14.3M at quarter's end, putting it at the low end of Apple's target range. iPad channel inventories were at 4.1M, in the middle of Apple's target range, while Mac inventories were below target.
  • Eight new Apple stores were opened in FQ4, raising the total to 416, of which 162 are outside the U.S. Apple plans to open 30 new stores in FY14, of which 2/3 will be outside the U.S.
  • Apple is deferring $900M+ worth of hardware revenue in FQ1 to account for the value of bundled software; gross margin would be higher otherwise. New products and a higher iPad mix are also expected to pressure FQ1 gross margin.
  • $35.5B of Apple's $146.8B cash/investment balance is in the U.S. The U.S. balance is down $5B Q/Q.
  • Cook says he sees major opportunities in new product categories next year (is he hinting only at an iWatch, or other products as well?).
  • Apple pares its losses, shares now only -0.5% AH.
  • CC live blogs: I, II. More on Apple's FQ4.
Comments (8)
  • vismadeb
    , contributor
    Comments (59) | Send Message
    take that Icahn - i am liking Tim more and more! Johny Ive is the new Jobs - Tim is squeezing those margins like there's no tomorrow :)
    28 Oct 2013, 05:54 PM Reply Like
  • harrykutcher
    , contributor
    Comments (83) | Send Message
    how many shares have been bought in so far and how many $$$$ spent????? anyone
    28 Oct 2013, 06:02 PM Reply Like
  • Humble Eagles
    , contributor
    Comments (1359) | Send Message
    Harry, didn't add it up, but total shares are just under 900mm, down ~40mm in 12 months. That would imply at least 18 bn or so.
    28 Oct 2013, 06:18 PM Reply Like
  • Humble Eagles
    , contributor
    Comments (1359) | Send Message
    We have a lot of positives that need to be digested. Cook basically said new product categories in FY 14. Guidance is conservative and higher. Last year they guided for 52Bn, and this year they guided for 55-58Bn. Margins would have been higher in guidance, but the deferred revenue has been increased by almost a billion this qtr to account for increased free software, will be recovered over two years. China growing. Cook predicts growth in Macs and iPads this qtr! Said, new Macs off to a very strong start. The feared collapse in margins and revs just isn't happening--they are actually growing. Not only that, but we are looking at very strong iPads and Macs, along with strong phones. Looking ahead 14, new product categories, big iPhones, and possibly China Mobile--very positive.
    28 Oct 2013, 06:17 PM Reply Like
  • Humble Eagles
    , contributor
    Comments (1359) | Send Message
    Obviously, the rev guidance would have been about 56-59Bn without the increase in deferred revenue.
    28 Oct 2013, 06:20 PM Reply Like
  • rrosey2
    , contributor
    Comments (686) | Send Message
    Now that the truth is out, Alpha should check back its analysts' statements and self-serving warnings; and do some thinning out.


    Readers want solid information and analyses rather than misinformation (which is PURELY designed to manufacture one-cent royalties). Beginners' scribbles.


    These strange doings, and today's Apple events, and the after-market weird stock swings; teach us to apply our own sense of what is reasonable.


    I am going to decide whether or not reading Alpha is good for my decision making.
    28 Oct 2013, 06:38 PM Reply Like
  • 2puttwo
    , contributor
    Comments (392) | Send Message
    One of my spies told me about a company purchased by Apple, that peaked my interest. Still trying to confirm, will spill the beans to everyone if and when I do. Very positive conference call. It's about time. Look for good things to come soon? Like Winston said in 41, " this isn't the beginning of the end, but it is the end of the beginning. It's the start of a great new year.
    28 Oct 2013, 08:37 PM Reply Like
  • scott trader
    , contributor
    Comments (4537) | Send Message
    Fifteen acquisitions..when will we know the 7 unknown?
    28 Oct 2013, 08:43 PM Reply Like
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