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Apple Announces Most Profitable Quarter in History
zacharye writes with an except from an article over at BGR about Apple's quarterly results: "'Disappointing' though it may have been to some, the iPhone 4S propelled what is now confirmed to have been the most profitable quarter any technology company has ever recorded. Apple on Wednesday reported record earnings for the December quarter, revealing a profit of $13.06 billion on revenue that surpassed $46 billion. Among technology companies, Apple's fiscal first quarter represents the most profitable quarter ever recorded. Only one U.S. company has ever posted a more profitable quarter — Exxon managed a profit of $14.8 billion in the third quarter of 2008 — and the driving force behind Apple's record-setting performance was quite clearly the iPhone."
As a WebOS fan, this makes me sad. Why would HP give up on such an incredibly profitable market after only investing $3.3billion http://techcrunch.com/2011/11/21/hps-failed-webos-experiment-cost-them-3-3-billion-but-whats-next/ ? The iOS and Andriod user experiences still have not passed WebOS smoothness, in my opinion, though the notification systems are catching up.
Although HP's management style of WebOS reminded me of: "They say you gotta spend money to make money. I don’t know what went wrong. We spent all our money." - Tom Haverford
It shows that nerds are wrong and Apple is right.
Seriously, you're confronted with an existence-proof.
Everybody gets what the majority deserves.
They make very little from the software/media sales. Gross margins on the hardware are huge though: 44.7%. Tim Cook indicated in the conference call that that's probably not a sustainable number (their margins are typically in the high 30s). But the raw numbers of devices they sold grew by stunning amounts. Even Mac volumes rose by more than 25%, and that's in a PC industry that's not doing that well in aggregate.
Say what you want pro or con about their products, but they know how to make stuff that people want to buy.
Case in point: Verizon reported that iPhones accounted for 55% of their smartphone sales last quarter. That's against how many different models of Android phone?
They are building all their products in China. What's so hard to figure about this?
So is everyone else. Everyone else is not enjoying this level of increase in profits quarter after quarter, or the same margins that Apple has.
Only Apple as far as I know has started moving any production (the A5 chip) back into the U.S.
OK, Foxconn will now pay the workers a few Renminbi more
They already do, and yet Apple's sales surge.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Of course some people seem to think that Windows and Android are winning.
It all depends on your definition of winning. One of the analysts covering the mobile industry was being interviewed on CNBC after Apple reported their quarterly results. This analyst claimed that 94% of current iPhone users would buy another iPhone but only 47% of current Android users would by another Android device.
None of the other phone or tablet makers have this kind of profit margin, yet their products easily match the iOS products
in quality and ease of use.
1) "match the iOS products in quality and ease of use." We'll have to agree to disagree on that one. Most Android phones I've seen (with some very few exceptions) feel cheap, they feel much cheaper than they are in fact.
2) Android makers get the OS for free, remember Apple does more than just sell the hardware. There's R&D, software development, patents to be bought, etc.
3) Even with a free OS, show me the phones and tablets significantly undercutting iOS devices while providing the same quality. And the "going out of business, please buy our inventory" sales don't count.
If apple cut their prices the "cool factor" would be diminished, and the fanbois would move onto something else. If they aren't over paying top dollar its just obviously not the best thing ever.
To me calling people "fanbois" and looking down on them because they think "the mainstream is so cool but they don't know what's cool, I know what's cool" just makes you another hipster. Just accept there are people who like something different from you, is that so difficult ? I can see why people like Android or Windows Phone, that doesn't make them idiots or "fanbois" just people with other needs.
If all else fails, immortality can always be assured by spectacular error.
However, the solution to a trade gap is not protectionism. It may help in the short term, and appear to be an ideal solution but it only hurts the economy as a whole and stifles growth.
Examples? This seems to be an oft-quoted talking point, but I've seen few evidence to support it.
I do have a counter example. Brazil has high import tariffs, which apply, among other things, to Apple products. Did Apple pull out of Brazil? Hell no. Foxconn is building a factory in the country now so that they can manufacture locally and dodge the tarrifs. End result: numerous local jobs which feed right back into the country's economy, and, of course, all those workers pay taxes, too.
It's perfectly logical, too. Apple can outsource manufacturing to China to cut costs, but they can't sell as many of their gadgets there as they'd like to (to make profits like the one in TFA). They need rich countries for that - the kinds of countries where workers are not overworked and starved so they have interest in fancy gadgets like that, and paid well so that they can afford them. So if you just make that particular method of cutting costs unprofitable - via tariffs, for example - you'll see manufacturing plants in U.S. and Europe in no time.
And no, you can't compete with China otherwise. Not unless you are willing to bring the standard of living down of their level - and not to the level of Chinese middle class, which is the lucky 200 million; but down to the level of those factory workers, who think of their 12 hour job as God's grace compared to what they face otherwise.