“Consumer trepidation stemming from the cascade of crises on Wall Street has intensified, and retailers fear the worst holiday shopping season in years. While no one knows yet how hard ‘Main Street’ will get hit, you can bet almost everyone will be cutting back on their spending in the months ahead,” David Zeiler blogs for The Baltimore Sun.
“Rockville, Md.-based ChangeWave Research added to the gloom with a report that its latest survey of consumer PC purchasing habits showed a significant drop for the Mac. Those who said they planned to buy a Mac laptop in the next 90 days dropped 5 points from August to September (34 to 29 percent), with those planning to buy a Mac desktop falling 4 points (from 30 to 26 percent),” Zeiler reports.
“Apple inevitably will feel some pain. Economic troubles overseas also will negatively affect Apple, as the company has worldwide operations. The iPhone faces competition from Research in Motion’s forthcoming touchscreen Storm as well as smart phones running Google’s Android operating system,” Zeiler writes. “But I still think Apple will weather this recession (I know one hasn’t been declared officially yet, but it won’t be much longer now) reasonably well.”
• Apple has $21 billion in cash stowed away
• Apple has an extraordinarily powerful brand
• Apple is committed to innovation
“Jobs and his lieutenants know innovation is Apple’s strength in both good times and bad. Bold new products keep the media — and hence the public — focused on Apple,” Zeiler writes. “Unveiling compelling new products while its competitors retrench will give those consumers who are still spending one more reason to choose Apple.”
Full article – recommended – here.
Cash is king. Apple has all the cash.
2 months from now we’ll learn ChangeWave Research interviewed the exact same 100 people for each survey and that 9 of them had bought Macs.
God I love poles!
@HMCIV
“Poles”? “Polls”? I love Hungarians and Czechs too.
Mike has it pretty well nailed. But Apple’s prospects go deeper than that.
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Because Cash is King, Apple has enough that they don’t have to borrow – at least, not soon. Or, not much. Apple can buffer the problems they will all feel and continue to build new product – even if they have to cut their margin a bit to move it.
Because Apple will be able to continue to build product, they will be able to fill every order directed their way. HP and Dell may lose sales because they can’t borrow the money to get the systems built. AND, of course, businesses will put off sales for “replacement desktops” for as long as possible – shrinking that market segment, which Apple has but a small presence in. And, when businesses start to buy again … WHO has the product to sell them?
The consumer market, where most of Apple’s sales are found, will certainly shrink a bit. The top end – Apple’s territory – less than the bottom end. Thus, Apple’s sales may suffer even while their market share continues to expand.
It looks to me like Apple will need to tighten their corporate belt to get through this, but less than the others in the Top Five. And, when they come out of it, their position will have improved.
Just my opinion.
I’m part Bohemian. Does that count?
@Mike & DL
Correct. Apple has a nice little war-chest set aside for ‘unforseen events / circumstances / opportunities’.
Nice to know they have it.
MaWo: ‘economic’. hahaha…
Recession? Thppft. Let’s see how Apple weathers a depression. ‘Cuz like it or not, it’s beginning to look like that’s where we’re headed…
——RM
Apple has the cash? That’s bullshit, Apple is cheap. They don’t even spend any money on anything instead they copies ideas off competitors that are well off. No innovation comes out of this little company who things itself as a leader in innovation while isn’t.
I think Apple Inc in the short term will do relatively well, but if you look at the long term growth not very much once their products dies off.
ps. Apple products are not very original, so outdate and uncool.
Nime? Is that short for Nime-rod?
“Cash is king. Apple has all the cash.”
CashFlow is king. Cash only helps you weather times of negative cashflow. Pick your favorite .com company to understand the truth of that.
“HP and Dell may lose sales because they can’t borrow the money to get the systems built. “
Highly unlikley.
HP has 14 billion in cash and equivalents. 50 billion in total short term assets, 42 billion in short term liabilities. So a net 8 billion surplus.
Sure Apple’s better off with 18 billion or so surplus, but just what are those short term investments invested in? When a company tells you it has “Cash” it means it has things it can (usually) turn into cash very quickly, not a large bin of cash sitting somewhere.
Lets see: Well about 6 billion are US treasuries. That’s as good as cash. Most of the rest is commercial paper, US and foreign. Up until recently, as good as cash. Today, well I guess the US government is buying because no-one else is. So the credit crunch affects Apple’s short term “Cash”.
“businesses will put off sales for “replacement desktops” for as long as possible – shrinking that market segment, which Apple has but a small presence in. “
Businesses will not defer as fast as consumers will defer expensive purchases. If a business has a PC come up off lease or break and need replacement, they need to do it to keep people productive.
If Joanne 401k holder has the kiddie’s PC break down, She’s letting them share and waiting until things look a little rosier. If she’s a little nervous about her job, but buying anyway she’s buying them a $400 PC not a $1200 Mac. It’ll do them for now…
That guy is TOTALLY confused. He must watch CNN.
Nime, if your rant made any sense whatsoever, I would have taken you serious. I don’t. And given that your screed was written in pidgin English, you have been officially disqualified.
On the matter of a company like Apple having a lot of cash, remember that only a few months ago, clueless activists and pundits were demanding that Apple give its cash back to shareholders. Given the major liquidity issues affecting businesses in light of the current investment and economic climate (and I am stating that mildly), Apple, and other companies that follow similar practices in building and holding their cash assets, are starting to look pretty smart.
But then, the pundits will find something else to attack with Apple. Just read anything within the C|Net organization (like the mindless screeds from Don Reisinger, for a case-in-point), and you’ll see what I mean.
My understanding is that Apple has significant holdings in commercial real estate as part of its stash. I would imagine it has gone down in value. If it is in Dollar denominated investments it has lost significant value over the last couple of years, although the dollar has gained some small measure of it’s lost exchange value back.
Bottom line, we are in a deflationary period combined with a whole bunch of other economic woes and you cannot eat an iPod. Your Mac might help you make a living, however.
Nime and Joy of Tech, MOST of us in this forum are not offended by ESL types who abuse the English language a bit – as long as they let us know that’s the situation. “sorry for my English, I’m a Swede” or the like goes a long way. But, your poor language use, your hostile attitude, and your lack of actual knowledge all suggest you are but pathetic trolls hoping for nothing more than the start of a flame war. Sorry, kiddies. You aren’t even good at being trolls. Tell the teacher you are sorry for not listening to her … she won’t believe you, you did the same thing in her class. Did she keep you back? Or pass you on to something worse?
“Those who said they planned to buy a Mac laptop in the next 90 days dropped 5 points from August to September (34 to 29 percent), with those planning to buy a Mac desktop falling 4 points (from 30 to 26 percent),” Zeiler reports.
The question I have is this drop in the number of those saying they anticipate buying a Mac due to people deciding to buy cheap Windows box in lieu of a Mac, or are they putting off buying a computer altogether??
Either way there’s an impact, but it’s important to view the entire industry, too.
“$21 billion”?
Dang!!! That’s more than I make in a whole month!!!
ok i havent read all the posts, but i dont think anyone has mentioned the fact that apple is growing at some absurd rate against the industry average. (30% am i wrong)?
But if companies like Dell is losing market share. May I point out that they just or in the process of selling one of their factories because they have ramped down production. One the contrary Apple had just but a state-of-the-art factory located in or around the main campus. stick that up your tochus Dell!!
If a mother might by a $400 PC, you must consider Apple’s refurbished sales unit (which I am unaware of the profit it generates)i which allows them a chance to take subtle gains in market-share, of which over time could add up.
If computer and IT sales start to decline the factor would be to compare it against the decake (any) amount of computers sold,, even if they might below the estimes But I say eff the estimates, they continuously have been wrong, downgrading apple, when obviously it is so undervalued because of its possibly of growth and innovation, with just the Mac unit growth of, correct me if im wrong, 40% year over year Mac growth.
Look at Sony who has recently tried to developed a lame immigration Apple’s use of a magnificent ascetically designed sleek machine, the sexy iMac.. Still one problem its got this little irritating thing on it called vista,
So All of apples products are becoming mainstream, with a possible slowdown in the ipods sales, one of their most profitable units. Additionally they are continuously expanding the retail store with 200 apple owned retail outlets, which are popping up all over the united states and the world, with their newest store set to open in Zurich, and stores in the heaviest shopping traffic in the world, London, 3 in NYC, 5th ave, Soho and the Meatpacking District, in which designers such as theory and ed hardy have their stores.
“One the contrary Apple had just but a state-of-the-art factory located in or around the main campus. “
Apple don’t have any factories. All manufacturing is outsourced.
“you must consider Apple’s refurbished sales unit “
If she’s considering a refurbished (nice word for faulty and repaired or used) product, she’s considering a $200 refurbished PC.
“a possible slowdown in the ipods sales, one of their most profitable units.”
And nearly half their revenue. And here again, if the kiddie gets an ipod, the kiddie gets a shuffle for Christmas, not a mini, or a Mini not a touch.