A few weeks ago Scott Galloway, the Clinical Professor of Marketing at NYU, gave an incredibly fascinating presentation at the DLD conference in New York. I just happened to notice the YouTube video of his presentation today. He spoke for about 23 minutes in an action packed presentation on the winners and losers of the digital age. I highly recommend watching the entire thing, and we've embedded the video below.
This week Apple managed to complete a bond sale of $12 billion. In short, Apple raised $12 billion in several tranches with maturity dates spread between three and 30 years. The yields on the bonds range between 1.07% and 4.43%. Some Apple followers are curious why they're doing this. In simple terms, Apple has committed to return some of its cash to shareholders and one tax efficient way to do this is buy back its own stock. Here's how it works:
Alongside their Q2 2014 results, Apple announced a 7 for 1 stock split. In other words every share of AAPL will soon become 7 shares of AAPL. Whenever a big company announces a stock split lots of people talk about it as if it’s some kind of big deal. It isn’t really a big deal at all. Public companies like Apple have their shares traded on a stock exchange where average Joe buyers like you and I can buy and sell. Big money managers can do the same. The total number of shares in existence makes up the entire company. I often explain that it’s like cutting a pizza.
Last night I was all set to review another boring Apple quarter. Many stock followers thought the numbers would arrive in line with guidance (and Street expectations), and that there wouldn't be too much exciting stuff happen on the call.
Today after the market closes AAPL will report Q2 fiscal 2014 results. Expectations are for a boring (read: very profitable, but no growth) quarter. Analysts forecast $43.5 billion in revenue and $10.18 in earnings per share (EPS), which is pretty much a repeat of last year's numbers. Unless Apple surprises us with something, the focus isn't going to be on the results, or even the guidance for next quarter. Apple investors want to know what's coming next. We all want to know — what will Apple do to become a growth company again?
With AT&T reporting its financial results this week the media is buzzing about comments they (and others) have made to the effect that smartphone subsidies may eventually come to an end. The theory being floated is that future mobile phone buyers will be aware of exactly how much how much their smartphone costs. This new financial awareness will somehow prompt fewer people to pony up for an expensive iPhone.
This morning an analyst posted something speculative about the possibility of a price increase on the iPhone 6 when it is released later this year. The analyst in question has horrible history when it comes to making Apple predictions, so we're going to ignore the source. What we aren't going to ignore is the idea. Could Apple use the iPhone 6 as leverage to raise iPhone prices?
Earlier this week Amazon launched their much awaited streaming media box for the big screen, Fire TV. Android Central has done a Fire TV review and iMore has already put the Fire TV vs. Apple TV head to head, and it's been compared to Roku as well. Most people seem to agree there isn’t anything too special about what Amazon has done … at least not yet.
We’re almost a quarter way through 2014, and it seems some Apple shareholders have ants in their pants. They’re impatient and want to see what Tim Cook’s team is going to do in a new product category, be it an iWatch, Apple television, or something else entirely. I guess it isn’t enough for Apple to be so utterly dominant in mobile computing, an industry trend that will keep chugging along for the next decade?
Apple’s decision to introduce a new model of the iPhone 5c with 8GB of storage has some of us scratching our heads. So does their decision to reintroduce the previously killed off iPad 4. What’s going on? Has Apple gone insane? I don’t think so. It may not qualify as a genius business move or anything exceptionally special, but I think it makes sense.
Now that iOS in the Car has been renamed CarPlay and will be shown off at the Geneva Motor Show, I thought it would be fun to start a discussion on what this all means to Apple, its competitors, and car drivers going forward.
The news of Facebook acquiring WhatsApp for an enormous pile of money is front and center in the mobile communication industry today, and for good reason. Having watched WhatsApp grow from nothing into a cross platform winner over the last 5 years and doing a darn good job of executing on a growth plan, I'm impressed with what they've done. And while I was shocked to see the deal's valuation, I've taken some time to think about it rationally, and it might not be that insane.
A few days ago rumors of Apple/Tesla meetings resurfaced, and conclusions were once again leapt to about a possible acquisition. It’s unfortunate that most people writing about the topic seems to have nothing but mergers and acquisitions (M&A) on the brain. I think there is absolutely no chance that happening and what's more — I think there are far more interesting possibilities to consider here.
Earlier this week analyst Benedict Evans published a chart showing how “computers” running Apple software are starting to sell at greater volume than "computers" running Microsoft software. Of course he’s counting all Macs and iOS devices as computers, just as he’s counting all Microsoft Windows PCs and Windows Mobile phones as computers. But the numbers don’t lie. In the last quarter Apple's traditional + mobile business is responsible for shipping just as many units as Microsoft. And obviously Apple is growing much faster. The blog post accompanying the chart was a mere 3 sentences. The most important sentence was:
Over at Asymco blog, Horace Dediu wrote a wonderful post that examines the size and growth of Apple’s iTunes business. This business includes the sale of music, video, iOS apps, Mac apps, and various services.
Tim Cook revealed today in an interview with the Wall Street Journal that Apple had purchased $14 billion of its own stock in the last two weeks. This brings the total buyback to over $40 billion. You might recall that back in April of 2013 Apple announced its plan to return $100 billion to shareholders by the end of 2015 including a $60 billion stock buyback. So here we are in early 2014, only 10 months later, and Apple has completed two thirds of its buyback. This is not the sign of a company lacking confidence in its future. Why?
Last night Apple released its financial results for the holiday period, which is their Q1 of fiscal 2014. If you’re into this sort of news you already know the Street reacted very strongly to the numbers … and not in a good way. The stock tanked after hours, and as I write this morning the stock is down a whopping 7.5% on a day when the overall market (and practically every tech stock) is trading higher. Wall Street hates Apple right now. But is it justified? Were the results really that bad?
Last week my wife and I left the kids in the fine care of my in-laws and headed to Playa del Carmen, Mexico. Practically every year we escape winter for a week, firmly plant ourselves into pool chairs at an all inclusive resort ,and soak up the sun. And when we do, I can't help but have my head turned... by the kind of devices people are using poolside. Hey, I'm a tech geek!
Rumors of a 13-inch iPad Pro were once again making the rounds this week, amped up by talk of a 4K Retina display. I have absolutely no idea whether or not it will ever become a real product, but I’ll happily go on record saying I don’t think 4k resolution makes a lot of sense for a tablet. It’s possible someone might put one out, and it’s definitely possible that there is a market for one, but I don’t think it’s possible for such a product to financially matter to a company like Apple in 2014. Personally, I think Apple could get more bang for the buck if they opened a game store for the Apple TV.