“First, the bad news: Apple’s profits aren’t growing much. We pretty much know why. The iPad Mini accounts for about half of Apple’s iPad sales—and the Mini is a less profitable product than the Maxi,” Adam Lashinsky writes for Fortune. “The other strain on Apple’s profits is its capital expenditures, a forecasted $10 billion this year, up from $8 billion the year before.”
“[Plus], Apple’s quarter was a week shorter than in the year-earlier quarter,” Lashinsky writes. “Now for the good news: The iPad Mini’s success is a sign that no matter what CEO Tim Cook implies about not being concerned about market share—he answered a direct question on the subject by saying Apple is focused on building great products, not growing revenues—Apple is fighting to keep its share of the tablet market. He dismissed a question about Apple’s interest in producing multiple sizes of iPhones. All that means is that Apple hasn’t yet introduced multiple sizes of iPhones.”
Lashinsky writes, “If ever a company can afford to invest in its future by insuring that it brings in new customers it is Apple. It ended its quarter with $137 billion in cash. Another hopeful sign is that same capital-expenditure figure. Apple says it is spending about 10% of the $10 billion on new retail stores. The rest is for equipment. Those who question Apple’s ability to profit from its massive investments in new equipment to build category-defining products are betting against a juggernaut.”
Read more in the full article here.
MacDailyNews Take: All of that CAPEX. $9 billion for “equipment.” Is Apple’s Liquidmetal deal finally about to bear fruit?
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