Apple growth hinges on China, new devices

“Sometimes even eye-popping results are not enough,” Poornima Gupta reports for Reuters.

“Apple Inc’s shares rallied on Wednesday on the back of another spectacular quarter that included soaring iPhone sales in China, but the naysayers are still asking if the most valuable American company might need yet another revolutionary product in the next year to sustain its sizzling growth,” Gupta reports. “The skeptics certainly lost some credibility when the company’s shares surged 9 percent on Wednesday, adding about $50 billion to Apple’s market value, but some have not been silenced. Their case is based on the law of large numbers – it is going to be more difficult for Apple to grow as fast the bigger it gets – and on the unforgiving nature of the technology business that can turn heroes into has-beens overnight.”

“The bulls point to emerging markets – in particular China, whose mobile market is the world’s largest and far from saturation – and upcoming products like a 4G-enabled iPhone 5 and the oft-rumored Apple TV, as sustaining astonishing growth such as the near-doubling of net income in its second quarter,” Gupta reports. “But the bears, with a longer-term view, fear that Google Android devices will eventually put pressure on Apple’s margins in China as they have elsewhere, and wonder if Apple will be successful in tacking on another blockbuster consumer device to its portfolio.”

Read more in the full article here.

MacDailyNews Take: The war over the AAPL buoy continues. Whatever side you’re on, embrace the other, for they help create your opportunities.

As per Android putting pressure on Apple’s margins, what’chu talkin’ ’bout, Willis?

If you’re going to twist reality, at least include a shred of it.™

Please see related articles below.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]

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  1. “Google Android devices will eventually put pressure on Apple’s margins in China as they have elsewhere”

    Where the FSCK has anyone put any pressure on Apple’s margins anywhere in any market?

  2. Apple defies conventional wisdom. Conventional wisdom is sometime referred to as “common ignorance.” It’s like anything else. What we don’t understand we try to force into the context of what we do understand.

    Here is a company that says building the best products is more important than being profitable or market share, and the result is they have seized the lion’s share of profits and market share in their business sector. Seems logical to you and me, but we aren’t “analysts.”

    Whenever anyone used to bring up market share to me in the old Apple days, I’d always say, “You don’t get it. Apple has 100% of the Macintosh market. No one can compete with them.” Non-Mac-users never got it.

    So now we keep hearing about the law of large numbers. AKA “OMG! This can’t go on forever.” Well no it can’t go on forever. Nothing does. At the same time though, they still don’t know us, the Apple/Mac market. We now include more people from all over the world than ever before. We all appreciate these products. They help to bring joy and fun to the otherwise mundane tasks in our lives. I gotta check client servers in the morning when I wake up, respond to emails, read IT news sites, and my iPad makes me feel like Captain Effin Kirk when I do it. So when there’s a new more spiffy model, i’m likely to buy it. I like the feeling.

    This kinda stuff doesn’t fit in their view of the world.

  3. Funny how somehow Apple needs to add more miracle products for these asswipes in order to survive, even though they beat all other companies with their existing ones.

    Reuters = dimwit writers

  4. the Reuters thing wrote, “… the bears, with a longer-term view, fear that Google Android devices will eventually put pressure on Apple’s margins in China as they have elsewhere.”

    Yeah, that “margin pressure” must be why Apple’s margin increased from 42 to 47 percent last quarter. Apple must hate when that happens…

  5. Apple will keep expanding its margins higher due to further advances in design which allow fewer components needed as well as less manual labor and quicker production. Few consumers are interested in leaving the Mac/iOS platform when 99% are satisfied with the platform & what it does for them on a daily basis.

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