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Apple Has First Earnings Decline In More Than A Decade (go.com)
An anonymous reader writes: Apple has announced its first-ever decline in revenue in the past 13 years as its iPhone sales have slowed down. Apple posted quarterly revenue of $50.6 billion and quarterly net income of $10.5 billion. Last year, the company posted revenue of $58 billion and net income of $13.6 billion. The reason Apple has been so successful is because of the iPhone, which was first released in 2007. What goes up must come down -- and we're starting to see that now. The success of the iPhone is starting plateau and ultimately decrease now that consumers are finding less of a reason to upgrade to the latest and greatest smartphone. Apple CEO Tim Cook pointed to weakening currencies worldwide as one of the obstacles the company would face as iPhone sales were up less than 1 percent year-over-year last quarter. Gene Munster, managing director and senior research analyst at Piper Jaffray, told ABC News, "This has been anticipated for three months now. The reason is nothing [that] is wrong with the iPhone." Munster said this is not worrisome to Apple and that iPhone sales will likely increase by the end of the year when the next iPhone(s) is released.
Apple is living on borrowed time. They need to come out with something disruptive, but all they can do is incremental upgrades.
When a company buys back it owns stock it means they are convinced (or want to convince the market) that they are undervalued and that that can earn more by doing this and waiting for the market to catch up than by acquisitions and that they have convinced the stockholders that this is a better idea than paying it out to the stockholders=owners as dividends. It does not necessarily mean that they don't know how to invest.