Apple’s fiscal Q2 earnings were the company’s ‘worst ever’ of the last decade in terms of year-over-year growth, but not in terms of actual commercial activity during the first three months of 2016,” Daniel Eran Dilger writes for AppleInsider. “While CNBC lines up pundits expressing their surprise about Apple not beating its record quarterly sales and earnings reported in the year ago quarter, the real surprise should be that Apple didn’t perform worse. ”
“After all, over the past quarter—and back into last December, before Apple had even reported its fiscal Q1 results for the end of 2015—reports had been rolling in from Japan’s Nikkei, as echoed in the Wall Street Journal, that based on supply chain rumors, Apple was cutting iPhone production by 10 percent in the December quarter, and 30 percent in the March quarter,” Dilger writes. “Those supply chain rumors didn’t materialize in any sales shortfall in the December quarter—iPhone 6s actually sold slightly better than the blockbuster iPhone 6 cycle had at the end of 2014, even despite unfavorable economic conditions including very ugly currency headwinds across most of Apple’s international sales regions.”
“In March, iPhone sales were below the previous year, but not anywhere near the reported 30 percent supply chain cuts. They were, however, well above the previous iPhone 5s cycle, showing that the anomaly in Apple’s consistent pattern of global growth wasn’t so much this year, but last year,” Dilger writes. “Apple’s ‘very bad’ quarter was its second best Q2 in history.”
“It will be important for Apple to more clearly articulate going forward that not only does it have a vast hardware business that operates like a wildly profitable version of Samsung (x4), but that it also has a Services business twice as profitable as Facebook, and is building out new cloud infrastructure to feed that enormous audience, rather than speculatively building commodity cloud infrastructure like Amazon,” Dilger writes. “If Apple can communicate that it isn’t just a commodity hardware business like HP or Samsung, it demand a valuation that reflects that its past growth wasn’t just a fluke of being in the right place at the right time, and that it didn’t just accidentally end up with $10 billion in quarterly free cash flow.”
Much more in the full article – recommended – here.
MacDailyNews Take: Ahh, perspective. More, please!
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Apple’s $10 billion quarterly profit is not enough? – May 2, 2016