Income Statement It seems that FY 2013 was very tough period for computer Software and computer electronics industry. Astoundingly, Apple sales growth smashed to 9.20% in FY 2013 from 44.58% FY 2012 as compared to Google whose sales growth dropped to 19.23% in FY 2013. Due to slow growth in sales the revenue of apple drastically affected as sales/revenue is backbone of profit. However, in FY 13, the net profit of Apple drastically falls to $ 37bn from $ 41bn. Still, company sustain to keep its overall growth which is supported by its immense cash in hand. Apple was not able to control on its cost of goods sold, which is the main pinpoint in financial statement of FY 13. We can even go in more detail to analysis the Apple FS compared to Google through ratios: As we discussed earlier, Apple’s cost of sales was increased at high rate compared to sales growth which affected its profitability ratio compared to its previous year. Due to its COGS, Apple’s profitability went below the Google’s growth. For FY 2014, there will be optimistic growth rate of around 30.15% in Operating profit. Income from discontinued operations supports the net profit of Google. Hence, COGS was major chunk where Apple needs to look at it and increase on its sales because T Return on Shareholder’s equity went down tremendously, still better to …show more content…
For Apple, net profit and total assets turnover ratio were the key factors in pulling down the ROE. According to figure 4.1, in FY 2012, net profit and total assets turnover ratio of Apple were 26.67% and .89 respectively and it fell down to 21.60% and .83 in FY 2013 and its equity multiplier also increased which shows that assets were purchased through more debt. Hence, it becomes risky for a company if its equity multiplier increases at much faster pace than net profit and total assets turnover ratio. At the same time, ROE of its competitor was just affected by equity
With Apple the Growth has been substantial and it can be stated that the Products have reached a maturity stage and hence there is a chance of decline. This has also been evidenced to certain extent as Samsung has taken over as the market leader in the mobile phone segment. The emergence of cheaper brands like Lenovo etc has also been a challenge for IT products of Apple. However it is also true that Apple has always focussed on consumer trends and demands and thus has been capable of avoiding the decline stages. Further market development and diversification strategies have been suitably implemented
A competitive strength assessment reveals that Apple’s success is unmatched. They have been able to maintain the leading industry position while developing and introducing new products. Stock price is continuously rising and products are always improving. The current products are improved with software updates and new products are improved by
Throughout the past year, Apple stock has had an astounding growth of 45% over the past twelve months, as well as a 10% growth of dividends by 10%. This increase in dividend is expected to increase by 7.43% over the next 12 months. Along with stock price and dividends, earnings per share is also expected to rise. Earnings per share is expected to rise from the current amount of $1.88 to as high as $10.74 per share. Apple’s marketing strategy is designed to keep stock prices high and shareholders happy. This growth in Apple stock is expected to continue to rise with a median change of 8.7% in the next twelve months. The current state of Apple stock is very impressive and market predictions show that it should become even more impressive in the next twelve months. (Financial Times
In the article “Apple Forecasts First Sales Drop Since 2003 on iPhone Slowdown” by Adam Satariano he discusses many factors contributing to Apple’s first sales decline in over 13 years and what steps they plan to take to recover. Apple’s revenue was expected to produce $55.5 billion this quarter but the company believes it will be $50-$53 billion dollars (Satariano, “Apple Forecast”). This decreased is believed to show signs of saturation in the smart phone market. Along with iPhones, Apple also had a pause in its iPad and Mac sales last quarter (Satariano, “Apple Forecast”). Apple is still overwhelmingly profitable but they cannot rely on the adoption of smart phones to carry the iPhone sales anymore.
Operating profit margin figures in the table above show the return from net sales[13]. However profit margin ratios are high enough for the 3 years, there is a fall from 12.86% to 11.26% during 2011-12. Sales revenue increases with a higher rate than gross profit so there is a poor
Our group decided to analyse the company Apple Inc., listed on Nasdaq Market as AAPL. The analysis was mainly based on the annual financial report of the company for the fiscal year ended on September 29th 2007. Apple Inc. is today one of the most
Google Inc. provides the biggest threat to Apple Inc. due to the hugely growing line of the Android market and their overwhelming ability to provide advertising to vendors. This seemingly puts heavy pressure on Apple to keep up with new products and to continue to create the next best thing. Google provides a much different way of recording their revenue. This is due to the fact that they receive revenue in a much different way. Google, unlike Apple who mostly sells products over services, sells services over products. The main source of income they receive is from providing there vendors with advertising space. As much as 96% of the company’s revenue comes from this source (Google Inc., 2012). Within this variation, they recognize revenue a little differently. Since most of the revenue comes from advertising, Google collects most revenue on a
Apple’s management had predicted its margins to be shrieked for the next 5 years; as a cause of that recession that reshaped the market. The management took a fast and smart decision and they predict the market after they analyzed it and found out that they can make better future by using the low prices of the parts, rather than downsizing.
Further, in 2012 net income increased to $41,733,000,000. This shows that while the industry was declining, Apple was able to stay strong and profitable.
Apple profit margin was last updated September 2016 at a 19.24% increasing considerably from previous month which was had the poorest performance in the past 5 years as charts demonstrate blaming this occurrence due to the holiday seasons and major factors that contribute to their profit such as the release of new products.
Apple, Inc. currently has a Price-to-Earnings ratio of 43.70, compared to the industry standard of 36.50, and the S&P 500 average of 20.73. This indicates that Apple has a lower amount of risk than other firms in the computer manufacturing industry and other firms in
However, in spite of the successes of Apple, the Company’s stock price had been dipping since reaching its high
Established in 1976, Apple ignited the personal computer revolution with the Apple II and the Macintosh. Today, Apple designs, manufactures and markets personal computers, portable digital music players and mobile communication devices as well as related software, services, peripherals and network solutions. Apple sells its products worldwide through its online stores, retail stores, direct sales forces and third party distributors to its core customers—consumers,
* The product life cycle of Apple products are very small for that reasons revenues are more depend on launch of new products and service.
In 2007, after thirty years, the organization changed its name from apple computer to Apple INC, this was a significant move because the organization became more independent, and it was no longer known as a vendor to Macintosh personal computer line (Slind). This strategic move paid off; a year and half later, Apple INC’S third quarter net profit of 1.7 billion on or $7.46 billion in revenue (Slind)