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Apple has disappointing results

by on27 January 2016


Tame Apple Press spins it

Waking up this morning you might be surprised to learn that Apple had poor results yesterday, probably because the Tame Apple Press is spinning the poor results like a mad thing.

Apple’s iPhone sales, which make up the bulk of its profits, showed less than a percentage growth. If this were any other company, the press would be sitting and cackling like an old knitting crone at an execution during the French revolution.

Not Apple. It can confidently see its press report the news as if its first revenue drop in 13 years and flat number of iPhone shipments was a good thing.

The Verge  just reported Apple’s “largest profit in history” just because it always did. It also talked about record-setting sales in China even when Apple admitted they were pants.

Apple sold 74.8 million iPhones in its fiscal first quarter, ended December 26, the first full quarter of sales of the iPhone 6S and 6S Plus. The 0.4 percent growth in shipments was the lowest since the product was launched in 2007. In the same quarter last year Apple sold 61.2 million iPhones.

IPhone sales were expected to fall for the current quarter compared with the same quarter last year, Chief Executive Officer Tim Cook said.

In fact the results were as expected, the critical Chinese market weakened and Apple’s days of growth are over.

Apple’s favourite news agency, Reuters quickly dashed out a  follow up to its Apple results story claiming that Apple did not need China any more when it was going to move its focus on India where there were plenty of poor people willing to sell a kidney for its overpriced toys. But anyone with common sense would tell you that India cant replace the sales that Apple expected to get in China.

However Wall Street analysts are starting to read Fudzilla and have woken up to the concept that Apple is a company without any new ideas and is watching its cash cow age from over milking.

Apple forecast second-quarter revenue of $50 billion to $53 billion, below analysts' average forecast of $55.5 billion. In the same quarter last year Apple reported revenue of $58 billion.

It is rather difficult for the analysts who are quoted in these stories. They are clearly talking about doom unless Cook pulls a rabbit out of the hat – something he has been unable to do. However no one wants to report that.

J.J. Kinahan, chief strategist at TD Ameritrade was quoted as saying "Pressure on the shares will continue without a well-defined plan to grow sales or a new product."

After that Reuters stopped quoting people and instead, and we kid you not, got on the phone to American Apple fanboys and asked them if they would buy another iPhone. Not surprisingly 86 percent of iPhone owners were somewhat or very likely to buy another iPhone so apparently that means that Apple is saved. Of course that means that nearly 20 per cent of them are giving up on Apple, but that was another statistic Reuters wanted to avoid mentioning.

Apple Chief Financial Officer Luca Maestri told Reuters that revenue in Greater China rose 14 percent in the last quarter, Apple is beginning to see a shift in the economy, particularly in Hong Kong, which indicates that China will go pear shaped.

"As we move into the March quarter it's becoming more apparent that there are some signs of economic softness," Maestri said. "We are starting to see something that we have not seen before."

Revenue increased 1.7 percent to $75.87 billion, both records for the company. Analysts had expected revenue of $76.54 billion and even that was considered an optimistic figure.  If this were Intel or Microsoft there would be articles about the "death of Intel" how Microsoft "dropped the ball on mobile"  however no one seems to want to admit that Apple is doomed to become an ordinary tech company with ordinary results unless it can come up with something new quite quickly and that is something even we thing is quite unreasonable to expect. 

 

Last modified on 27 January 2016
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