Apple’s stock has been stuck at the $120-130/share range for the past several months. It’s peak was $134.45 back in February. But since that time the stock has been relatively flat when compared to the previous year of continual growth.
If you've ever wondered how Apple stacks up financially in relation to software giant Microsoft, perhaps your perspective should be flipped. It is Microsoft that must be viewed in relation to Apple’s success. During the last quarter Apple amassed an additional $32.7 billion in net income and cash, while Microsoft’s total revenue for the quarter stalled at $21.7 billion, up only 6% YOY. This meager growth barely tracks above inflation, and is not keeping pace with internal cost increases. The downward trend for Microsoft came in their net income, which saw a 5% decline in the face of larger revenues, a seriously dangerous equation. Microsoft blamed the strong US dollar for the fall, but Apple had no need for such excuses during their quarterly report. Apple’s YOY revenues grew 27%, while driving larger gross margins and a 30% rise in net income. The two companies couldn't be on more different paths.
Apple’s fiscal second quarter iPhone sales were simply amazing, but the Cupertino company is showcasing the value in diversity more so than any of its competition. Microsoft is simply a decades old franchise, one-hundred-percent dependent on Windows. Google just showed how unsuccessful it is outside of anything but search. Apple’s model of software coupled with various hardware businesses can withstand blows, and expand in ways that continue to defy the odds — and its detractors — alike.
Microsoft, the once mighty and feared software giant, is only a footnote outside of Windows sales. Office is the monster of business workflow, but without Windows and the forced Office bundles, who would value Word or Powerpoint over other solutions available today? Everything Microsoft had, has, and will have, revolves around Windows nothing more. Bing, Xbox and Windows Phone are all long-term financial nightmares for the Redmond, WA techno-giant.
Tim Cook has lead and experienced a wave of success at Apple. The result? Suddenly everyone wants part of the action. Cook is now being lectured by kooky numb-nuts with money and platforms on how to run Apple. Clearly, these people on the outside, who have done nothing to make Apple successful, know what is better for Apple than those leading it to record setting success.
It has been rumored for years. Mock ups have been made. Analysts have proclaimed launch season after launch season, year after year after year. Yet for all the hype and wondrous prototype possibilities that may – or may not – be hidden deep within Apple’s design labs, a 4K/UHD TV that sports an Apple logo may never be in the cards. Our condolences to Gene Munster.
Whether or not Apple could change the way a television functions and interacts with the user is the wrong question to ask. Apple is more than capable of creating markets from scratch and reinvent nascent technologies into something brand new and better. The right question to ask is whether creating a state-of-the-art TV would be worth it for Apple?
Apple’s earnings for the second quarter of their fiscal 2014 shocked Wall Street. In fact, it did more than just surprise, it blew the lids off investors’ expectations, causing Apple’s stock to skyrocket straight north. After hours trading revealed an increase of over $43 a share. Evidently, the move of Apple’s stock has staying power as it is still hovering around $565 per share. Looking back at the earnings call reveals the big items that sent the AAPL skyrocketing, but it also gives a glimpse into the future of where Apple is heading.
Apple's Financial Call Highlights: