
Apple 4Q Profit Jumps 47% On Higher Mac, IPhone Sales - sant0sk1
http://online.wsj.com/article/BT-CO-20091019-712705.html
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seiji
Who killed the link to the primary source non-subscriber content with actual
numbers?

<http://www.apple.com/pr/library/2009/10/19results.html>

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netsp
Quarter:

    
    
        Macintosh sales: 3.05        up     17%
        Ipod sales:      10.2        down   8%
        Iphone Sales:    7.4 up             7%
        Revenue:         $9.87b    (up from $7.9b)
        Profit:          $1.67b    (up from $1.26b)

~~~
10ren
For context, the 2008 iPhone sales (whole year, not a quarter) were $1.84B.
And now it's $7.4B _in one quarter_. Is that even possible?

[http://blogs.eweek.com/applewatch/content/corporate/apple_fi...](http://blogs.eweek.com/applewatch/content/corporate/apple_fiscal_2008_by_the_numbers.html)

Here's 2009 figures in a similar table: quarter not whole year:
[http://www.betanews.com/joewilcox/article/Apple-Q4-2009-by-t...](http://www.betanews.com/joewilcox/article/Apple-Q4-2009-by-
the-numbers-Beats-street-posts-167B-profit/1255985794)

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ddlatham
That's 7.4 million sold, not $7.4 billion in sales.

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10ren
Ah, thanks. Checking the links I posted:

iPhone sales go from $1.84B per year to $2.3B per quarter. Still pretty good.

(EDIT: rather bizarrely, that's _precisely_ a five-fold increase.)

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stcredzero
Time for them to come out with the next big thing, before they become the
captives of their own success. (Has that happened to Google? Definitely
happened to Yahoo.)

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joez
I'm not sure if I can agree 100% with this statement. While Apple is long
touted as a company built on innovation, they can probably extract profits
without any new innovations for a while. (A while being 2-3 years, doesn't
mean to stop trying though.) And it's true that iPod sales decreased 8% over
last year's Q3, they expected this because of increasing iPhone sales.

I believe while other hardware companies are racing to the bottom in prices,
Apple is able to extract premium on its hardware and this is really reflected
in the gross margin and bottom line.

Could Apple produce a 600$ laptop? Sure. But it is not worth the temporary
gains they'd see. A low end line would cannibalize the margins of their other
computers. The quality would probably suffer and it would hurt their brand
equity. Apple could introduce an economy line of computers and take over way
more of the market, probably grow their sales by 25-40% in a year. To me, that
is a strong statement... in that they could but they don't.

I think one thing that Apple will have to contend with is the image. As
iPhone's and Macbooks become more and more mainstream, the elitism behind it
is decreasing. They will need to do some kind of segmentation (and price
discrimination). I wouldn't be surprised if they came out with a higher end
Pro series priced around 2500.

Full disclose, I do own a few shares of AAPL. So I believe the future is
bright for Apple.

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stcredzero
I also believe the future could be bright for Apple. Even if they've peaked,
or soon will peak, they'll be profitable for a good, long time. That's not my
point. My point is that they can keep on the upward side of the peak by coming
out with another game changer.

I fully expect them to.

 _As iPhone's and Macbooks become more and more mainstream, the elitism behind
it is decreasing. They will need to do some kind of segmentation (and price
discrimination)._

Elitism is easy to maintain. Just make the packaging fancy and charge lots of
money! The ability to charge a premium also enables innovation, however. You
can charge more for your new, different thing, and if it's truly different
then it probably does cost more since economies of scale aren't fully in play.
Also your new thing can be truly new and different -- this enhances the caché
and lets you tap into status-seeking early adopters.

Apple seems to be in the space where Mercedes used to be -- able to charge a
premium for well engineered and truly (though conservatively) innovative high-
quality products. The danger is in _too much_ power in the marketing arm. If
the company succumbs to the temptation to sacrifice quality and innovation for
better marketing, then it is done for. If that happens, Apple will become a
vacuous status symbol, and the real engineering innovation will come from
someone else. A clear and present danger! (Many would say it has already
happened.)

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joez
Yep. The day Apple is fully ran by MBA's and the Marketing department is the
day it peaks. This will probably be around the same time it comes out with an
low end laptop. The power right now is Apple's marketing arm is backed up by
technology and it is really in the pricing sweet spot.

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stcredzero
The incentive structure of the marketing department is almost _designed_ to
produce short term thinking. So _of course_ marketdroids have a bad name.
They're basically incentivized to kill the goose that lays the golden eggs.

I wonder if there's a better way we could structure this?

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netsp
Apple _is_ currently run by 'marketing department.' It's just a good one.

'Marketing department' doesn't mean the advertisers that have nothing to do
with anything else any more then 'engineers' doesn't mean techies in the back
room that have never seen a user and only work when you can tell them exactly
what to do. That's just what they seem like when they don't do a great job.

Deciding not to have any competitor below the 30-40th price percentile.
Deciding to always have a coherent product line. The decision to focus on
users wiling to pay outright for things instead of focusing on companies.
These are all marketing decisions more then they are engineering ones.

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stcredzero
What I've observed is that a lot of marketing departments are killing or at
least slowly poisoning their company. I suspect that you have to get to
somewhere between "good" and "great" to escape this.

Hmm. It seems that I've _never_ been in a company that had even a _good_
marketing department! (Until now.)

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netsp
Hve you observed engineering departments, research departments, IT,
Accounting, HR, Comms, legal... doing a bad job? Usually, most of these are
not critical enough to "poison" a business, crappy HR or IT is annoying, but
usually doesn't kill a company. Anything bad enough can, but if a department
is far away from how the company makes money, good enough is usually good
enough. Sometimes Marketing isn't important enough to kill a company either.
Often it is though.

The types of companies that get discussed on HN are usually the kind where
both marketing & engineering are important enough to do a lot of damage and
important enough for everyone to have an opinion about them.

You can top that up with the fact that the stuff that usually gets praise or
abuse (eg product development) can often be claimed or pawned off by both
engineering and marketing.

Who is responsible for the ipod nano video camera thing? Engineers?

Sometimes things are obvious. Google has awesome marketing, but the original
dynamite was creating the awesome search engine and the momentum caused by
gmail & maps & such. Facebook is, as far as I can tell, a marketing
achievement. In both cases it was important that the non dominant factor
didn't mess things, but it was a hurdle.

Apple or MSFT? You could argue both or neither. If you wanted to teach how to
be like them, the classes would probably be called things like 'strategy' or
'leadership.' I'm not sure that any department has a monopoly here.

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gamble
Apple's 10% market share is actually a financial advantage now that
application support isn't such a big issue. Whereas it would be hard for
Microsoft to grow beyond the overall market for PCs, Apple has plenty of room
to grow.

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netsp
Definitely. They have 10% of the OS market, 10% of the hardware market & good
margins on both. Growing from 10 - 15% is admirable, but not as hard as
growing from 70% to 105%.

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wmeredith
"Growing from 10 - 15% is admirable, but not as hard as growing from 70% to
105%." I just emailed this around the office. Hilarious.

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tsally
Ugh, this morning I almost put some capital in Apple stock. Now it's up 12% in
after hours trading. Investing is stressful as hell. I'm coming to the
conclusion that lacking a large amount of money or extraordinary skill, $/hour
is far better working a part time job.

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jonknee
"Investing" in the short term is simply gambling. It can be a lot of fun, but
the average person is (as you note) better off working.

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schammy
Whoopee. Wake me up when you an interesting story to report.

