“Apple (AAPL) had quite a newsworthy week last week, reporting Q4 earnings and then holding a press conference in which they unveiled their newest laptop, an upgrade of the super-thin MacBook Air that uses flash memory in lieu of a traditional hard disk drive,” MagicDiligence writes for Seeking Alpha.
“On the company’s conference call, a common question came up: what is the company planning to do with its more than $51 billion in cash and investments?” MagicDiligence writes. “Here’s what CEO Steve Jobs said on the matter: ‘We strongly believe that one or more very strategic opportunities may come along that we’re in a unique position to take advantage of because of our strong cash position.'”
MagicDiligence writes, “The question this naturally begs is: what opportunities could Apple pursue that would be meaningful to the company? One company on the Magic Formula Investing screens came to mind: flash memory vendor SanDisk (SNDK).”
“The strategic advantages for Apple are two-fold. Apple’s ground-breaking designs in mobile phones, tablet computers, and now in notebook computers make flash memory the company’s single most important component,” MagicDiligence writes. “SanDisk’s product gross margins are generally in the 30-40% range, meaning that Apple could conceivably secure their most important component at a significantly lower cost than competitors. The company has already shown the strategy of entering new markets at aggressive prices to shut out competition. A lower cost structure for producing these evolving new computing form factors is a significant competitive advantage. The other reason is technology leadership. SanDisk is a flash pioneer and holds most of the important patents on the technology.”
Read more in the full article here.
[Thanks to MacDailyNews Reader “Dan K.” for the heads up.]
It’s obvious that they will buy LG. That way they would have a screen, battery, and TV manufacturer. Also, we would be able to control our home appliances with our iPhone.
iWash
iDry
iFreeze
Funny how Apple’s money is burning a hole in everyone else’s pocket! First, I think whoever Apple does purchase (if they decide on an acquisition at all) will not be something that anyone will see coming. I think no one will even know about the acquisition until it’s over – just like their previous acquisitions.
I don’t think Apple will want to acquire the headaches associated with a component business – PA Semi was an engineering acquisition.
@cptkirk
I have thought about that for a long time. I really think that Apple wants to bring manufacturing over here for at the very least they would be able to control some of their prototype leaks.
I’ve suspected that they’ve been heading that direction ever since their unibody designs. It seems their trying to reduce the complexity of their housings to make manufacturing more affordable and thus offset the huge cost increase of doing it here.
Funny how Apple’s money is burning a hole in everyone else’s pocket! First, I think whoever Apple does purchase (if they decide on an acquisition at all) will not be something that anyone will see coming. I think no one will even know about the acquisition until it’s over – just like their previous acquisitions.
I don’t think Apple will want to acquire the headaches associated with a component business – PA Semi was an engineering acquisition.
@cptkirk
I have thought about that for a long time. I really think that Apple wants to bring manufacturing over here for at the very least they would be able to control some of their prototype leaks.
I’ve suspected that they’ve been heading that direction ever since their unibody designs. It seems their trying to reduce the complexity of their housings to make manufacturing more affordable and thus offset the huge cost increase of doing it here.
Apple does not buy hardware manufacturing companies. It is all about talent and IP.
Apple does not buy hardware manufacturing companies. It is all about talent and IP.
Guys, Sandisk is basically a fabless company. The bulk of their manufacturing is done in a joint deal fronted by Toshiba.
Apple would be buying talent and IP if they acquired Sandisk, not manufacturing capability. The patents they hold on flash memory are valuable. Just how valuable would be up to Apple to decide.
Actually, this is an intriguing idea. I don’t think this is what Apple is hoarding for though.
Guys, Sandisk is basically a fabless company. The bulk of their manufacturing is done in a joint deal fronted by Toshiba.
Apple would be buying talent and IP if they acquired Sandisk, not manufacturing capability. The patents they hold on flash memory are valuable. Just how valuable would be up to Apple to decide.
Actually, this is an intriguing idea. I don’t think this is what Apple is hoarding for though.
I have no idea what Apple will do with its money. I have heard that they like to skate where the puck will be rather than where it has been. Having said that, I read today that the dollar is at a 15-year low against the yen and falling like a stone against many other currencies. Apple may sense opportunity here.
We’ll see.
I have no idea what Apple will do with its money. I have heard that they like to skate where the puck will be rather than where it has been. Having said that, I read today that the dollar is at a 15-year low against the yen and falling like a stone against many other currencies. Apple may sense opportunity here.
We’ll see.
No need too
Apple has the intellectual commodity to do it themselves. They prefer to build their own factories.
However if Scandisk or other companies control patents needed it might be worth it
No need too
Apple has the intellectual commodity to do it themselves. They prefer to build their own factories.
However if Scandisk or other companies control patents needed it might be worth it
Apple should buy Adobe already.
Apple should buy Adobe already.
Apple is saving the $$ for when Obama destroys the rest of the economy…
Apple is saving the $$ for when Obama destroys the rest of the economy…
I heard they were gonna score some killer weed.
I heard they were gonna score some killer weed.
I wish they would buy Adobe and fix Flash… So there can be harmony, finally…
I don’t even think Adobe is worth that much even?
I wish they would buy Adobe and fix Flash… So there can be harmony, finally…
I don’t even think Adobe is worth that much even?
Samsung’s market cap is believed to be in the $120 billion range and they make everything from refrigerators to oven ranges and washers/dryers to cameras and printers besides chips, displays and TV’s. Samsung won’t just sell its chips or displays division when they are by far their most profitable businesses – chips alone generate 58% of their profits. Samsung has nearly a quarter-million employees spread out across the world with revenues that will soon exceed $130 billion. No, Apple will not and cannot buy Samsung. The Korean government wouldn’t allow that to happen either.
Samsung’s market cap is believed to be in the $120 billion range and they make everything from refrigerators to oven ranges and washers/dryers to cameras and printers besides chips, displays and TV’s. Samsung won’t just sell its chips or displays division when they are by far their most profitable businesses – chips alone generate 58% of their profits. Samsung has nearly a quarter-million employees spread out across the world with revenues that will soon exceed $130 billion. No, Apple will not and cannot buy Samsung. The Korean government wouldn’t allow that to happen either.
Look at the next nonvolatile memory technologies and their investors. Apple will jump ahead with a cheaper memory for which they own essential IP. Flash is reaching its limits now. Let the wannabes have their flash memory along with inferior write speeds and cost. There is a good reason why the new Air has a removable flash board.
Look at the next nonvolatile memory technologies and their investors. Apple will jump ahead with a cheaper memory for which they own essential IP. Flash is reaching its limits now. Let the wannabes have their flash memory along with inferior write speeds and cost. There is a good reason why the new Air has a removable flash board.
How can professional journalists not know the proper use of the term “beg the question?”
How can professional journalists not know the proper use of the term “beg the question?”