brewer

Apple Engineered Huge Margins Into Its iPhone

@ Keri:

What marketing expenses? Apple hardly advertised the iPhone at all. They didn't have to. When you have a product this cool, this revolutionary, the press will hype it for you. This is exactly what happened. If you ask me (and I realize you didn't) Apple didn't hype the phone at all. All they said about it was absolutely true, not hyperbolic. In fact, there was a lot of great things they didn't even mention.

Apple has had extremely conservative guidance. For years and years, they have far exceeded any wall street estimates. It's a JOKE among the Mac fans out there. What used to happen routinely is that they would triple or quaduple earnings estimages, and the stock would then go down on profit taking. Like clockwork.

Apple is finally getting the reputation they deserve. But still, writers often refer to the 'Apple faithful' etc... Sure, they have a lot of fans, but it doesn't take 'faith' to be an Apple fan nowadays. It would take faith to have any expectation that Microsoft would ever produce anything original or even usable (compated to the Mac alternative).

This fall, you will see an explosion of Apple fortunes. This is because they will take over the #1 PC sales position by licensing WIndoze and including it with their new OS X 'Leopard'. At that point, Windows is just a 'layer' not an operating system. All defaults will be set by Apple. All ad revenues from internet browsing, etc... will push Apple earnings through the roof.