“The ongoing saga of Apple (AAPL) should go down in history as an resounding vindication of behavioral finance. 12 months ago, the obsession du jour was with declining iPhone and iPad margins to the exclusion of higher unit sales in Asia and North America,” Kyle Spencer writes for Seeking Alpha. “Today, Wall Street’s obsession is with slight and ultimately meaningless decline unit sales growth.”
“One thing analysts fret over is whether or not Apple will lose its ability to charge a premium for its devices. Despite increased competition, evidence for shrinking margins via commodization just isn’t there,” Spencer writes. “iPhone and the Mac Desktop/Portable ASPs are actually rising, while lower iPad margins are due to the inclusion of the iPad Mini line.”
“Apple’s nominal R&D spend has increased dramatically. Apple’s recent $360 million acquisition of PrimeSense and as well a flurry of recent patent awards suggests that a new wave of product releases is on the horizon, including curved screens, enhanced biometrics, 3D gesturing, wireless charging and a major upgrade to Apple Maps are all in the works for 2014,” Spencer writes. “Increased R&D spend typically coincides with new product releases.”
Much more in the full article here.
Apple’s sudden urge to splurge on acquisitions – December 20, 2013
Apple’s 2013 R&D spending up 32 percent vs. last year, 87 percent over 2011 – October 31, 2013
Apple spent 3.4 billion on R&D in FY12, up $1 billion – the largest increase in company history – November 1, 2012