“Apple Inc. plans to increase spending on manufacturing equipment, product testing and retail stores by 57 percent in fiscal 2014 as it ramps up the output of iPhones, iPads and potential new products,” Adam Satariano reports for Bloomberg.
“Capital expenditures will jump to $11 billion in the current year, which ends in September 2014, from $7 billion last year, Apple said yesterday in a regulatory filing,” Satariano reports. “About $550 million of the spending will go toward retail operations, including the opening of 30 new stores and remodeling 20 others.”
“The higher spending suggests Apple may exceed some analysts’ sales estimates in 2014 amid strong demand for updated versions of the iPhone and iPad, according to Ben Reitzes, an analyst at Barclays Plc.,” Satariano reports. “Revenue growth may top 8 percent this year, he wrote in a note. That would indicate more than $184.6 billion in sales, compared with $170.9 billion last year.”
Read more in the full article here.
I look forward to the day that Tim Cook is vindicated. He is doing an amazing job, and getting few accolades. These jerks will have to eat humble pie at some point.
+1
The AnanTech article yesterday on the performance leap that is the iPad Air is one of the results of the quiet leadership: Apple buys up companies and talent that allow them to invest in what matters to their customers. Building a processor design team is not something Apple will ballyhoo at a press event. But the absolutely essential point about the acquisitions and results of those acquisitions is that Apple leapfrogs the industry because the internal teams know their customer is the Apple solution, not OEMs. When you look at what Intel must develop its processors for, you realize their target is to sell to OEMs, not to end users. Apple designs their processors to give the end user an amazing experience. And therefore they don’t have to support legacy designs that ultimately reduce performance for the end user.
But what’s happening at Apple, and goes unnoticed, unpublished and unheralded is just this sort of deep and internal investment that is propelling Apple ahead of everyone else. Witness Touch ID, iBeacon, A7, etc.
When Microsoft was winning because of the monopoly they built, they worked hard to lock other players out. That was their focus. We called it “Embrace (a standard), Extend (that standard in non-standard ways), Extinguish (that standard by dropping support for the non-extended aspects of it).” It infuriated everybody but Microsoft. Apple, on the other hand, is building a monopolist ecosystem, but are doing so by creating, building, delivering, and supporting an ever-larger suite of solutions for their customers. It’s an entirely different focus and therefore everyone else is having trouble understanding the importance of it (Carl Icahn, take note) and what is required to maintain it. Steve started this focus back during the dot-com burst and Tim, the board, the executive team, and the seasoned employees understand it and are continuing it.
Well Said Jim
Cook was asked by Steve Jobs to join Apple in 1998 and selected Tim to replace him.
“Nuff said!
I concur except for the “monopolist ecosystem” comment. While it is true that Apple has a “monopoly” within its own ecosystem, that is not the context in which the term is used in a legal sense. I believe that it would more accurate to describe the iOS ecosystem as “proprietary” or “closed.”
Very well put Jim.
@ Jim
Well said.
You are right about everything except the monopoly part… It’s like saying GM has a monopoly on building GM-cars… That does not hold water.
I read that apple was spending huge amounts on 20nm chip wafer machines and also investing in more cnc capacity. Those types of industrial tools do not come cheap.
1
that spaceship in Coop gonna cost coin too…..
Don’t forget about the expense of designing and manufacturing the A8.
The old aphorism “Lead, follow or get out of the way.” is no longer applicable when Apple sets the standards.
With Apple it is lead or get out of the way, because Apple is using its cash to make sure it leads in everything it does.
The move to robotic assembly in the US of the coming MacPro is more proof Apple simply will not be left behind the top of the innovation curve.
The latest iPad is proof along with its entire ecosystem of interoperability that Apple is spending to make sure they are the personal computing platform of the 21st century.
Very good.
They should ramp that up to 20 or 30 when they are at it. Do something with the money, something useful like this. Don’t waste it on useless buy backs…