What is Apple’s report card on this earnings report?
First, competition did not force Apple to cut prices on its products. This concept has been cited at length, but Apple’s iPhone and iPad ASPs declined just 4% and 1% respectively, and it was due to mix, not price drops. And, Apple’s forgotten products, Macs and iPods actually increased their ASPs 1.4% and 1.0% sequentially. Furthermore, looking back on the quarter, Apple’s competitors dropped their price points.
Second, gross margin did not fall off a cliff. And, management made a clear point that margins go through a defined cycle before and after product introductions, so margin shifts should be expected. Margins suffer in the short term for product development but pay off in the long term. Peter Oppenheimer cited three or four product examples where margins improved over time and made it clear they would not manage for the short term.
Third, they did mention new product categories. Not just new products, but new product categories. This (hopefully) suggests something more than a iPhone5S – same form factor with some new tricks. When asked about a larger screen iPhone, Tim Cook did not directly refute the concept but merely pointed out (a long list of) shortcomings with the current offerings, including screen resolution, brightness, etc. Perhaps larger screen iPhone is on the horizon? When asked about new product timing, Tim Cook did pass up a great opportunity to give investors a little something definitive on timing. This would have provided some satisfaction to investors.
Fourth, they brought up strong traction in the enterprise and commitment to China, two important growth markets for Apple.
Overall, Apple created the impression of “Steady As She Goes” which gave investors relief that the wheels did not come off the Apple bus. The report did not cite any catalysts to encourage euphoric buying but it provided investors with enough to stop the selling. Guidance for the June quarter was low and expected due to the combination of seasonality and anticipated new product introductions (and therefore demand pushed out to the introduction quarters). The numbers did suggest that long-term themes remain in tact which, at this valuation, makes Apple an attractive stock to own.
Si inca unul: cresterea exploziva a profitului (dat de cresterea substantiala a marjei) din 2012 a fost exceptia, nu regula.
Apple ramane o companie extrem de profitabila si focusata pe investitii in produse inovatoare care dau roade pe termen mai lung. Daca totul merge conform planului, aceasta faza de slabiciune relativa (fata de un an 2012 absolut exceptional) trece si Apple isi reia cresterea si vine si cu noi categorii de produse revolutionare. Iar ca si investitie recomand LEAPs de 2015 si/sau actiuni, cumparate undeva in lunile urmatoare (probabil iulie, in jurul anuntului urmator).