
Apple Reports Third Quarter Results - coloneltcb
https://www.apple.com/newsroom/2018/07/apple-reports-third-quarter-results/
======
jakobegger
I care a lot about the Mac, and I'm not sure what to think about the fact that
Mac unit sales are down again.

The Mac has been growing for a long time, and they seem to have reached a
plateau. I assume that's the reason why Macs have became absurdly expensive in
the last few years -- when they can't grow unit sales, they need to grow
revenue per unit.

The result is that Apple doesn't build the computer most of their potential
customers want -- a $1000 Macbook. I understand that they don't care about the
$300 netbook market, but not offering a decent $1000 laptop is a bad idea. It
means they are going to loose consumers and students – there are decent
alternatives at that price point. Or, people like me, who just keep using
their old Macbooks because the high price of the new machines isn't worth the
marginally improved performance.

Where does this lead us? I don't see how the Mac should grow from here, and as
a Mac software developer that worries me. I want to be in a growing market,
not a stagnant one. I'm probably going to be okay for the next few years, but
is the Mac still going to be a worthwhile platform for a small software
company in 10-15 years? I don't know.

~~~
mikestew
_I care a lot about the Mac, and I 'm not sure what to think about the fact
that Mac unit sales are down again._

Well, what do you expect people to buy? I'm sitting on a six year old MBP,
having gotten rid of my 2009 iMac. New iMac? Meh, it might come to that, but I
already have enough displays. Mac Mini to go with the display I already have?
Surely you jest to suggest a four-year old model. Mac Pro? See: Mac Mini.
Current laptops aren't an option unless I get desperate (i. e., current MBP
dies tomorrow). I mean, I _want_ a new Mac, there just isn't anything out
there that makes me feel like I'd be getting an upgrade.

So my theory is that a lot of people are in the cycle I've been in for the
last three years: "Meh, I'll wait to see what they have next year...<year
passes>...Meh, I'll wait until...holy shit, is this thing really six years
old?...<year passes>"

~~~
3pt14159
This is precisely why I like Apple. The fact that I got 5 years out of my last
MBP was totally amazing. I used that computer at least 10 hours a day, _every
single day!_

I don't care about saving $1k or $2k when it comes to a device I use that
much. We're talking about a dollar an hour here. I've literally spent more
money on coffee over that time.

~~~
jandrese
I'm typing this post on an 11 year old Dell Latitude D830 running Ubuntu. 5
years is not some amazing lifespan for a laptop, especially these days with
such incremental improvements in processors year over year.

Unless you're gaming on your laptop your requirements probably aren't that
much higher than they were half a decade ago.

~~~
toasterlovin
It's an amazing lifespan for anybody who has ever operated a windows laptop.

~~~
scarface74
I have a 10 year old Dell Core 2 Duo 2.66Ghz running Windows 10 being used as
a Plex Server. It’s only slow when overtaxed because I haven’t bothered
upgrading to 8GB of RAM or replace the hard drive with an SSD.

Luckily it has a gigabit Ethernet port so it can take full advantage of my gig
internet.

------
ihuman
MacStories has some nice graphical visualizations comparing this quarter's
results to previous quarters.

[https://www.macstories.net/news/apple-q3-2018-results-533-bi...](https://www.macstories.net/news/apple-q3-2018-results-533-billion-
revenue-413-million-iphones-116-million-ipads-sold/)

~~~
downrightmike
On why the US tax rate should be raised: access to the most profitable market:
[https://2672686a4cf38e8c2458-2712e00ea34e3076747650c92426bbb...](https://2672686a4cf38e8c2458-2712e00ea34e3076747650c92426bbb5.ssl.cf1.rackcdn.com/2018-07-31-15-40-37.jpeg)

~~~
gnicholas
This might make sense if the US had a territorial tax system, like much of the
rest of the world. But the US rate applies to the _global_ profits of US-based
companies.

The mix of high rate and worldwide (non-territorial) taxation is why so many
US companies end up being acquired by foreign companies. Then you don't have
to pay US rates on your worldwide income.

------
ArtWomb
Cash on hand now upwards of _$230B_. Your average CNBC talking head would
probably recommend a large acquisition soon. Names usually whispered about
include: Uber, Tesla, Snap or Netflix. Or a content studio such as Comcast,
Disney, or Fox.

But such advice ignores the gargantuan growth that cloud services are
experiencing right now. Although iCloud, iTunes, ApplePay and the AppStore are
almost solely focused on consumer internet and retail. It's conceivable that
$APPL would make a push to deliver more SaaS offerings. Perhaps analagous to
Adobe's Creative Cloud suite for profession digital content creators.

~~~
amunicio
They should buy Sony. It would give them:

\- Universal Studios

\- PlayStation (aka a big foothold in the living room) and some of the most
creative game studios

\- Awesome displays (TVs)

\- Bigger footprint in the consumer electronics market

\- ... and most important of all the best camera sensors in the market
(including camera phone sensors).

~~~
scarface74
The console market is minuscule compared to the phone market.

Sony has only sold 75 million PS4's since it was released
([https://www.businessinsider.com/ps4-playstation-4-lifetime-s...](https://www.businessinsider.com/ps4-playstation-4-lifetime-
sales-2018-1)). Apple sells almost that many iPhones in a good quarter.

TVs are big and bulky and have something like an 8 year replacement cycle.

~~~
amunicio
But it would be 82 million Apple TVs overnight after a software upgrade.

Not to mention PlayStation Vue could become Apple Vue.

~~~
scarface74
And PS Vue would only be of use in the US.

At the end of the day, PS Vue doesn’t offer anything compelling enough to
acquire. A few subscribers and a bunch of licensing deals to broadcast TV over
the Internet. Apple could get the same deals as Sony, Sling, Directv, Hulu,
etc. Cable networks aren’t exactly being stingy about licensing.

------
mark_l_watson
Great conversation thread here. I will add my bit: I have been an Apple
customer since buying serial number 72 of the Apple II (and worked writing
software for 45+ years).

I love the iPad. I use Mac laptops for programming at work and my personal
projects, but, I use my iPad for SSHing to my servers, reading, audio books,
watch movies, research material for new books and technologies I want to
learn, take online courses, write, etc.

Yes, laptops are great for writing code, but much of my thinking time is done
with an iPad. When I retire, I can imagine just using a remote VPS for
recreational coding with whatever can get decent screen space and a keyboard
for a few SSH shells, and everything else could be an iPad.

~~~
deepaksurti
Can you recommend apps you use for SSH'ing to the servers?

What do you use to write? I have just started with the Apple Pencil and love
it, use Notability. Any recommendations here will help.

~~~
jiqiren
[http://www.blink.sh](http://www.blink.sh) <\- so far the best terminal.

Includes mosh support so you can sleep your iPad, switch between LTE/Wifi, etc
- then later continue your terminal without interruption.

~~~
evgen
IMHO the absolute best thing about Blink is that it lets you use caps lock as
control. Since doing this remapping on my laptop it is now a part of my muscle
memory but no bluetooth keyboards support this in hardware and iOS does not
support it in software; Blink manages to support this in the app and it makes
my SSH sessions and remote editing so much easier.

------
maddyboo
I find it a bit funny that the title of the consolidated financial statements
PDF [1] is "Microsoft Word - Q318 Earnings Press Release - Word.docx".

I guess Apple's accountants use MS Office?

1:
[https://www.apple.com/newsroom/pdfs/Q3FY18ConsolidatedFinanc...](https://www.apple.com/newsroom/pdfs/Q3FY18ConsolidatedFinancialStatements.pdf)

~~~
HenryTheHorse
No CFO on the planet will ever approve of a statement prepared on anything
other than Excel.

~~~
hellofunk
Except it's not Excel, it explicitly says "Microsoft Word".

~~~
mikestew
Right, because if you use Excel you're probably not firing up Pages to do the
quarterly report.

------
mythz
Killed it again:

    
    
      - Revenue: 53.3B (17% YoY) 
      - Net Income: 11.5B (40% YoY)

~~~
igravious
Macbook Pro sales down to 2010 levels. Worrying for the HN crowd, no?
Bloomberg tech reporter saying that the Macbook is going the way of the iPod.
:/

~~~
ravitation
Apple still relies on the MacBook, and specifically MacOS (of which the
MacBook is the flagship product line), as a development platform for all of
its other devices... Within Apple's current platform strategy, Apple does not
have any alternative for the MacBook. So, it's currently not possible for the
MacBook to go the way of the iPod...

~~~
wlesieutre
Sure it can, they still sell an iPod Touch model from 3 years ago.

Heck, if all they sold was a Macbook Pro from 2015, quite a few developers
would be _happier_ about it.

~~~
scarface74
They did up until a month ago....

------
willwagner
I believe around $199 a share is when AAPL would become the first company ever
to have a market cap of $1T. It could happen tomorrow. For reference, the
first $1B market cap company was US Steel in 1901.

~~~
bufferoverflow
Well, if you inflation-adjust, there probably were $1 trillion companies.

~~~
jonknee
There have been several. Saudi Aramco is one right now (and has been for some
time), but it's not publicly traded.

[http://www.visualcapitalist.com/most-valuable-companies-
all-...](http://www.visualcapitalist.com/most-valuable-companies-all-time/)

------
minimaxir
Basically the opposite of Twitter's and Facebook's results.

Reporting says services revenue (App Store, Apple Care, Apple Pay, iTunes) is
up _31%_ , despite heavy competition in those areas.

~~~
philjohn
Well, if you're in the Apple ecosystem, App Store is where you're going to get
your apps, iTunes is where you're going to buy, versus stream music, and who
else to trust to fix your iDevices than Apple themselves? So where's the
competition?

~~~
reaperducer
For buying music, Amazon. It does a surprisingly good job on the Mac.

For streaming, Apple is still an also-ran, even on the iPhone, and even with
40 million subs.

------
HenryTheHorse
$4.7B in iPad sales. That's 4.7 BILLION. At nearly 10% of their revenues, the
going-going-gone tablet category _still_ has some legs. Who would have thunk?

/edited the numbers. I had mixed up the Mac and iPad revenue figures.

~~~
threeseed
iPad sales should go through the roof later in this year.

The acquisition of Texture and the upcoming refresh with iPhone X style design
should drive a lot of of users to look at iPads as a magazine replacement.
Especially if it comes free as part of your existing Apple Music subscription.

~~~
stefan_
_Again?_ Feels like all the magazines around here went through their "digital
edition with these cool features" phase 4-5 years ago.

~~~
reaperducer
IIRC, it was called Zinio, and didn't work very well. Crashtastic.

If Apple can do it right, something could happen here.

Especially if it makes it cheap and easy for independent publishers to climb
on board.

------
pastor_elm
seals the deal. $1200 base model Iphone here we come.

~~~
reaperducer
Three months after that... $1,200 base model Samsung phone.

Three months after that... $1,200 base model LG phone.

Three months after that... $1,200 base model no-name Chinese phones.

~~~
tooltalk
?? Wasn't Samsung the first to produce $1000 phone last year, followed by
Apple a few months later?

or if you are insinuating that everyone else is merely copying Apple's pricing
strategy (or anything that is Apple), or just copy, copy, copy, Apple fanois
website is that way --> Appleinsider.com

------
MaysonL
R&D spending up 26% y/y.

Other revenue(watches and AirPods) up 37% y/y.

------
thecosas
Earnings call:

[https://www.apple.com/investor/earnings-
call/](https://www.apple.com/investor/earnings-call/)

------
vivan
The iPhone is a beast and a market leader - that is known, and shown in these
results.

The Mac however is in decline - Apple seem to have abandoned it in favour of
their cash cow (as many on here have complained) and these results just
further prove it.

------
diminish
iPhone Market share (~11%) and unit sales of iPhones are flat compared to last
year on a no-growth market. Service and Mac sales seem to be dependent on
iPhone sales.

Quarter by quarter Apple turns into a one trick pony where most income depends
on the success of their smartphone market share of ~15 +- 4%.

If there were a novel approach to smartphones/mobile computing - Apple/iPhone
would look a lot like RIM/Blackberry in 2010/2011 where sales and revenues
(services) skyrocketed yet analysts were warning us. Yet there's to tech
rising to kill smartphones. So Apple is safe for some years ahead.

Welcome to trillion+ valuation AAPL.

~~~
ksec
>Welcome to trillion+ valuation AAPL.

The word welcome as if someone already has a trillion cap and welcome them.
But in fact no one has done it, and even if they did by real dollar and for a
short moment; There were one or two companies that touches the trillion market
cap for a few hours / days and came back down. Apple may be the first one to
truly worth it.

~~~
diminish
Aren't there non public oil giants who're worth more? Like Saudi Aramco?

------
onetimemanytime
Major congrats to them and to the late Jobs. I'd be in the Ballmer category...
[https://www.youtube.com/watch?v=qycUOENFIBs](https://www.youtube.com/watch?v=qycUOENFIBs)
Making telcos "subsidize" it, must be right there with the "pay just the
minimum on your credit card" business wise. Brilliant.

------
Tomminn
Anyone else notice that after hours trading puts em a few mill shy of a
trillion?

------
ryanx435
there have been about a dozen new hires at my work, each of them getting a new
mac book and accessories to develop on.

multiply that by all of the new hires across the country and some of the
lowest unemployment numbers in years and you've got a good set up for apple's
hardware division to make a ton of sales last quarter.

...

but unfortunately, looking at their data, it looks like I was wrong: unit
sales for macs fell by 13% compared to last year, and 9% compared to last
quarter.

interesting.

Edit: downvotes because I made a prediction before looking at the reports then
acknowledged I was wrong and didn't delete my post. Cool.

~~~
zhonwang
Might surprise you but the vast majority of IT units hiring people are not
giving them $1500-$2000 Macbooks

~~~
lev99
You only spend $2000 on your mac books? My last one was $3,750 after shipping
and taxes.

~~~
yalph
Wow!! Can you say it is absolutely worth it?

~~~
lev99
It's extortion. MacOS is the only good consumer OS built on *nix, so I'd
probably pay 3x if they charged it.

~~~
yalph
Haha fair enough. I too like the OS but that pricing point is way too steep
for me.

------
pastor_elm
who knew emojis were so profitable

~~~
mayneack
slack

------
codelord
Apple is making great money selling consumer products and services. It's time
Apple uses some of that money to build better hardware for developers without
considering immediate profits. We need MacBook Pros that are actually designed
for professionals. No touch bar, better keyboard, better CPU and GPU. Consider
it an investment on your developers.

~~~
threeseed
I am a developer and I really love the new MacBook Pro.

The CPU is now on par with the rest of the industry, keyboard issues largely
resolved and the TouchBar is incredibly useful for developers. Look at the
recent update from IntelliJ to see some of the future potential. Contextual
buttons that completely change depending on what is selected is something
nobody could ever remember with Fn keys e.g. refactoring specific buttons when
a method is highlighted.

~~~
nategri
> I am a developer and I really love the new MacBook Pro.

I'm guessing you don't use vim.

~~~
hatsubai
Being a Linux kernel and OS developer for a defense company, vim has been my
main editor for quite awhile, and I have no issues with the touch bar on my
new 2018 MBP. For those that require the tactile feel, there's always
remapping caps lock, as well as utilizing other key combos:
[http://vim.wikia.com/wiki/Avoid_the_escape_key](http://vim.wikia.com/wiki/Avoid_the_escape_key)

If muscle memory is that engrained within the user that he or she cannot
utilize any of the aforementioned alternatives, nor adapt to the difference in
feel of the touch bar, then your choices are either an older iteration of the
hardware, or switch completely. Claiming that, "you don't use vim," if you
enjoy the new MBPs is, however, off the mark, IMO.

