Petr Škuta Not everyone is a fan of long tables and graphs. Sometimes it is better to convey information by listing key information. Let's take a look at 8 key points revealed by Apple's fiscal third quarter results.
Apple is doing well and bad language people are having bad luck again. On the other hand, more than ever, one can see the transformation from a company mainly supplying hardware to a company providing hardware and connected services.
The iPhone is no longer the mover
For the first time since the fourth quarter of 2012, iPhone sales did not even account for half of Apple's revenue. It thus takes the position of a predator mainly accessories, especially AirPods and Apple Watch. At the same time, these products are ably supported by services.
On the other hand, all the mentioned categories are backward dependent on the iPhone. If the popularity of Apple's phone declines significantly, it will have a direct impact on revenues from accessories and services. Although Tim Cook promises the arrival of services that will not be tied to the device with the apple logo, most of the current portfolio relies on the close connection of the ecosystem.
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David Hanak Accessories are growing like never before
Accessories, mainly from the field of "wearables", catapulted Apple ahead of 60% of companies operating in this segment. Apple makes money by selling accessories more money, than for example by selling iPads or Macs.
AirPods have become a similar hit as the iPod once was, and the Apple Watch is already synonymous with smart watches. A full 25% of users then upgraded their watches in the last quarter.
The trade war with China did not threaten Apple
The foreign and especially economic press is constantly addressing the trade war between the US and China. While more tariffs and bans on product imports hang in the air, Apple wasn't hurt too much in the end.
Apple rebounds in China after slump. A slight increase in income can be seen in the year-on-year comparison. On the other hand, the company helped it by adjusting prices, which are now among the lowest within Apple's pricing policy.
The Mac Pro may remain in the US
Tim Cook surprised many when he announced that Mac Pro production may remain in the US. Apple has been manufacturing the Mac Pro in the United States for the past few years, and it certainly wants to continue doing so. Although many components are made by companies from China, there are also components from Europe and other places in the world. So it's about getting the process right.
Apple claimed at WWDC 2019 that the new Mac Pro will be available by the end of this year. It is still uncertain whether the production will be completed.
Apple Card already in August
Apple Card it will come in August. However, Apple's credit card is exclusive to the United States for now, so only residents there can enjoy it.
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Services will grow especially in 2020
August will be marked by the Apple Card, and in the fall Apple TV+ and Apple Arcade will come. Two services that will rely on subscriptions and regularly bring additional revenue to the company. However, Apple's CFO Luca Maestri warned that revenues from these services will probably not be reflected in the financial results this year.
Apple will likely offer at least a one-month trial period for each of them, so the first payments from users will come only after that. Moreover, the success of these services will only be proven in the long term.
Research and development is at full speed
Investors are always interested in which direction Apple is going and what products it intends to introduce. However, Tim Cook rarely even hints at anything. However, this time the current CEO talked about the amazing products that are yet to come.
Cook said that we can expect something big in the field of augmented reality. Leaks also suggest that Apple has been researching autonomous vehicles for a long time. The company has spent over $4,3 billion on research and development.
The concept of Apple Glass, glasses for augmented reality:
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Expected results for Q4 are surprisingly low
For all the self-praise, Apple ultimately expects fourth-quarter 2019 revenue to be between $61 billion and $64 billion. At the same time, the previous fiscal quarter of 2018 brought Apple 62,9 billion dollars. The company does not expect miraculous growth and is keeping its ground. Investors are hoping for the success of the new iPhones, but the company's directors are tempering their excessive hopes.
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Dan Pražák Source: Cult of Mac
Speaking of profits... If I change the iTunes Store when moving to a new country, specifically from Ireland to the Czech Republic, will I lose all my apps, movies and music purchased in Irish iTunes if I change the region to the Czech Republic? How do i have to proceed? Can I then switch between regions? Is there any way to arrange to have both regions at the same time?
I think that Apple will wipe the eyes of all those who say that Apple is not innovative and remember Jobs. Today, innovation is probably not in the hardware, but in the services.
A slightly better camera, or a flexible display that fits on a stick, is not really an innovation.