Apple Reports First Quarter Results
apple.com
apple.com
This is interesting, as the majority of the publicity I've seen about the iPhone X has painted it as lackluster.
> The Company posted quarterly revenue of $88.3 billion, an increase of 13 percent from the year-ago quarter and an all-time record, and quarterly earnings per diluted share of $3.89, up 16 percent, also an all-time record.
As much as I see people deride the touchbar or the iPhone X notch, it seems consumers are at least willing to take a chance and try out something new.
When the iPX first launched the narrative was "holy shit this phone is flying off the shelves", since then OLED stock has been falling (really good time to buy tbh), apple cuts back production, and the narrative has gone sour.
What gives?
1. highest revenue ever from a new iPhone lineup
It's also the most expensive. Simply put, they could sell fewer iPhone Xs and still make more revenue simply because of the increased price.
So even with the highest revenue, it could still be lackluster in quantity sold, as well as what the profit is like.
2. [iPhone X] has been our top-selling iPhone every week since it shipped in November
It simply needs to sell more the other iPhones during the same time period. This makes sense, as it was released later than the iPhone 8. You could make the assumption that the majority of everyone that wanted an iPhone 8 would have bought one prior to the iPhone X being released.
For here, a better comparison would have been units sold of a new iPhone and if it beat that.
Again, I'm not suggesting it's a failure or a success, merely trying to look at the quote objectively and what it says, and what that really means.
Apple issued guidance for this quarter that they expected revenue to be $60-62b. Analysts expected revenue of $65.9b.
Stocks are priced on the expectation of the future, so the change in the expectation has probably had a negative effect on the price. As an individual investor (disclosure: I own a little AAPL) I think it is foolish to worry quarterly earnings and revenue forecasts. Yet it is what people write about. It is easier to write about quarterly earnings then it is to write about industry trends, in the same way it is easier to write about polls than it is to write about policy.
https://www.bloomberg.com/news/articles/2018-02-01/apple-for...
As noted by @rjones [1], 2Q total units sold historically range between 50-52M.
If Apple had originally placed orders in Q218 for 40M iPhone Xs, then either a) iPhone X is 80% of all iPhone sales, which is hard to believe because of the current lineup diversity, or b) Apple expects total unit sales for 2Q18 to be above 80M, which is hard to believe because of 1Q18 guidance.
The better explanation is that Apple probably cut production for any number of reasons, but nowhere near as drastic as 50%. 20M is 40% of 51M, which would point to the iPhone X selling very well through 2Q18, and continuing to be the best-selling iPhone model.
This happens every year when a new iPhone comes out. Contrarian news drives clicks.
Barclay new price target is $162 this morning. Also a couple downgrades
"Apple gets two downgrades due to ‘dramatically’ slowing iPhone X demand"
https://www.cnbc.com/2018/02/02/apple-gets-two-downgrades-du...
From this morning after releasing results.
Plus Q2 guidance was $60B versus consensus of $66B for Q2.
The analyst and the reports seem accurate. Can you explain?
It was never about Q1 but Q2 - Q4 and guidance.
Apple is down from $180 in 2018 and flat this morning. Barclay new price target this morning is $162.
Could be related to the above? Most of the publicity I've seen is domestic to US, but it's certainly possible overseas has a much different view on the iPhone X.
Later, Apple releases numbers which suggest that it's selling great (https://www.cnet.com/news/apple-iphone-7-tim-cook-first-quar...)
I think maybe it's time to stop listening to "analysis" on their sales until there are real numbers.
Popular thinking can't really wrap its head around risk management.
Supplier A talks to a friend in the media and all of a sudden the story is that Apple has a big problem because their new phone isn’t selling.
What no one is saying (possibly because as we all know Apple like secrecy and repolish them) is that supplier B had a 30% increase in orders from Apple, or supplier C is now coming online when they weren’t involved before.
Since we don’t have the whole picture, it’s hard to know what’s actually going on outside of effectively one rumor.
Or it could be stock manipulation.
The simple fact that they had no idea how it would sell could mean they asked suppliers to be ready at the high-end of expectations.
In other words: when you see someone publish a “forecast” that a particular company’s product isn’t doing well, the analysis is usually flawed. If it weren’t flawed, the market price of the analysis probably wouldn’t be “free.”
I’m speaking from experience - I know a quantitative researcher who successfully forecasted Apple’s iPhone sales to a fraction of a percent a few years ago (very clever method!), and I’ve personally done this with Tesla model sales/production.
For Tesla auto sales couldn't you just look at tesla vin numbers?
For iPhones, sample mac address's?
You’ve definitely intuited some of the method, yes :). The rest of it entails:
1) how to get all VINs both authoritatively and legally,
2) how to distinguish between valid VINs and assigned VINs,
3) how to reverse the actual revenue projection from the set of all assigned VINs.
The first requirement is the hardest. Tracking self-reported VIN delivery from users isn’t rigorous enough. You could use an endpoint and scrape from it, but how would you do it legally and reliably?
The second requirement is also difficult. Assuming you’ve found an authoritative source for valid VINs, how do you distinguish which VINs are assigned?
Once you have those two, the third requirement is mostly straightforward. You can implement your own VIN decoder using public NHTSA documentation, map each VIN field to options and prices across models, and track sequential VINs using the distinguishing method of requirement 2 on the data you’re getting from requirement 1.
Naturally, there are other ways to do this that don’t involve VINs at all.
Sometimes it's just good old illegal insider information.
I say “simply” because it doesn’t require any of the infrastructure you mentioned, which is what the public typically associates with “alternative data.” It was actually quite impressive and novel at the time, and inspired other projects of mine.
I can talk about this now because (to my knowledge) it no longer works, though it did for a while. He was in charge of approximately $100M when he was working on this.
Tons of money exchanged hands on the stock market because of it.
Shares are down from a high of $180 and pre-hours this morning flat. So consistent with what analyst were saying.
It was not about Q1 but about Q2 guidance.
The forecasts in the media were about the absolute levels not relative.
If there are d units demanded and p units produced, and d >> p, then unit sales = p. Next year, if there are d' units demanded and p' units produced, and d' >= p' while p' > p, then unit sales are going to go up. This tells you a little bit about d', but not everything.
People really like believing in rumours.
There was a LOT of chatter about the cancellation of the X in the summer due to low numbers:
In a new report obtained by AppleInsider, acclaimed KGI Securities’ analyst Ming-Chi Kuo says disappointing sales of the iPhone X will lead to the cancellation of the model “with production ceasing in the summer”. This would be the first time Apple has canceled an iPhone model after just one generation since the iPhone 5C in 2014.
Apparently he's been pretty consistent in getting big leaks like this right:
Kuo, who has a long track record successfully revealing Apple’s plans, said lack of interest in China is the main reason. In China big screens are king and the iPhone X’s polarising "notch" is seen by Chinese consumers as removing too much usable space. Especially when the cheaper iPhone 8 Plus actually delivers slightly more.
The news also follows a new survey from Cowan that claims an interest in new iPhones has hit a historic low.
https://www.forbes.com/sites/gordonkelly/2018/01/21/apple-ip...
This still makes it a rumour.
One day they might be right. Apple can't hit and exceed expectations forever, probably. But so far it's the same old bad rumors every year.
OLED screens are in short supply, and that will take a few years to turn around. This November, Apple can either split their limited supply of OLEDs between iPhone X and iPhone Xs (or XI or whatever that winds up being called). And that's not even factoring the likely larger-screen model...
It got distorted through a game of telephone into the iPhone X being "cancelled." Or rather, it got distorted by people looking to gin up a sensational, yet false story.
It probably has become lackluster in some countries thus giving those reports. Definitely true in Singapore, there were plenty of IPX stocks available in Dec unlike previous years. But it's doing very well in China so overall it's a win for Apple.
Apple's improving their operations every year, so they can ship more units now than they could last year or the year before. Previously, if Apple was completely supply-constrained between launch and the holiday season, they would only earn revenue on the quantity of iPhones they could ship. Now that Apple has improved their supply chain volume, their launch quarter units shipped will go up purely as a function of that, and their revenue will also increase as a function of the higher unit price of iPhone X.
The only difference, if there truly is one, will come in the next quarter or two. If a product is supply-constrained, there's a backlog of demand for it that only gets met down the road. If the product isn't supply-constrained, there isn't as much backlog and consequently, unit sales and revenue won't be as high. But that doesn't affect the launch quarter because the launch quarter is completely limited by supply.
If iPhone X was a total flop, of course, that would have shown up by now. But "iPhone X less popular at launch than iPhone 6" is a hypothesis we can't judge yet.
Edit: It's also really, really easy to tell whether a product is supply constrained. Just go to apple.com and see how long it'll take to ship. See if people are scalping them on Craigslist for a premium over the retail price. These kinds of things happen with major console launches and used to happen with Apple's product launches, but Apple is one of the biggest consumer electronics brands in the world, has some of the best operations in the world, and contracts with the best high-volume electronics manufacturer in the world, so it's more than possible for them to overcome the supply constraints that "plagued" previous launches.
iPhone has an installed base of 1.3 billion users. That's more than 1/6 of the world population. At this point, there probably aren't even enough people in the world who can afford smartphones for demand to grow as fast as supply. If Apple's operations and supply chain can grow faster than the global middle class, they're going to get past their supply constraints, and apparently they already have. That's not necessarily a reflection on this year's iPhone.
They made more money, but only because everything they sell is more expensive. Shipped fewer devices this quarter.
The problem is that Apple is still the market leader in many respects. For example, in my opinion, Apple's build quality, customer service and trackpad are still so far ahead of the PC industry that I wouldn't buy a non-Apple laptop. I also think touch ID is a great addition. But I don't want the touchbar. Too bad, if I want the latest Mac laptop with touch ID, I'm forced to take the touchbar.
People just like to knock on the #1 guy. It's easy and gets clicks.
I would not call the touch bar low quality. I would call it useless.
On a related note, the massive trackpad was the first one Apple has produced that bugged me. It got stuck in “drag” mode frequently because my palm would register as a touch point. It also didn’t always register clicks on the right edge. Still better than almost all other trackpads I’ve used.
Disclosure: I work at Microsoft. Was testing the latest MacBook Pro for my own use.
Haven’t had a problem with the massive trackpad either.
And in general that's the case. It's been easy to have point-and-slide control over arbitrary UI laptop elements as long as there've been touchpads. The difference between a touchscreen and touchpad is marginal. At some margins -- particularly the operation of pocket computers with a form factor about the size of a laptop touchpad -- that's been tremendously useful, but I don't see any evidence that anyone's come up with something that genuinely matters for laptops yet.
I do have to flick my eyes down to find the button, but it doesn't bother me---fully understand it might bother others, though.
Once I get farther into the row of function keys, I don't have as much of a memory for them. I'd guess that's at least partly because I don't use the key backlight and playback controls as much (auto key backlighting works very well for me, to the point where I almost never adjust it manually, and the playback controls don't work with much software other than iTunes which I've been avoiding for years now). Maybe mostly that, as in the past I've definitely had a "tap without looking" relationship with F5 for reload (now apparently mentally mapped to cmd-R).
"Having a dedicated position to change often-changing settings is more useful" is pretty much the whole point of function keys, except they do a better job of it than the touchbar does, and quite likely a better job than the touchbar can.
I kinda like my mid-2017 keyboard. It takes getting used to, and is a bit louder than the external or my older 2013 MBP keyboard, but it's quite nice.
The trackpad sensitivity is annoying though. I had to turn off tap-to-click which I'd been used to for decades.
Funny thing is that I sat down with my boss to troubleshoot some stuff today and he was cursing up a storm about the touchbar keyboard (usually he docks the thing and uses an external keyboard). I've largely gotten used to it, but still haven't memorized the location of the navigation / modifier keys. It's like the iPhone 6/7 -- I've gotten used to the camera hump but it still drives me nuts every single time I put the phone down.
I'm pretty sure China alone made the X worthwhile.
You just were looking for such opinions.
Why do I feel this is actually some sort of gaming of the system which ought to be investigated by authorities? Clearly, there are players are constantly doing this to drive share price down, buy the stock and wait for it to bounce back up again after earnings.
My personal example of my contribution to the raise of the installed base was: I've used the Christmas sales to buy a new iPhone for me and a new iPhone and new iPad for my parents. I've considered buying cheaper Android devices for the parents, but the ease of use of iOS and the better security compared to Android still won.
But, dear Apple, dear anybody from the company who maybe reads this: please don't let your current management levels dilute the old clear vision, the "ease of use" goal. My parents are especially annoyed, for example, by not being able to permanently disable the additional "Apps" buttons in the Message app that get in the way. Ditto for not being able to have the former "simple mode" of Notes. (And I'm personally annoyed by "a" looking too much as "o" in the Notes). It's hard to keep the focus that Jobs was able to reach, but please understand that that legacy is still something that motivates at least these older users that I know.
And one more detail: the iPhones I've bought are with the earphones jack, still! I'm not sure I will want these without it. Keep that feature somehow or this may be the drop that moves the writer of these words to the actions of the guy from the Samsung's "Growing Up" ad.
Having a bunch of buttons near the text field of a message to be sent that can be accidentally and easily hit is an UI fail for anybody surely not needing that bunch of buttons. You can show them to those who need them but you should let others protect themselves from them especially in the app that can result in sending SMS or MMS which can be expensive.
That seems extremely high to me. Also, iPads bring in less revenue per unit sold (13.170 million sold for $5.862 billion of revenue, or $445 per iPad)
What do they count in iPhone revenue? “deferrals and amortization of related software upgrade rights and non-software services.” according to https://www.apple.com/newsroom/pdfs/Q1_FY18_Data_Summary.pdf, but what are those, and why would they be different for iPhones vs iPads?
iPhone X 64GB - 897 GBP -> https://www.amazon.co.uk/dp/B076GQZRR9 (there is one seller for 800 GBP, but it has 0% positive ratings and looks like a scam)
1.8x for the same size
The iPhone X price is still ridiculous, don't get me wrong, but Samsung phones are pretty damned expensive on launch, too.
The Note 8 launch price was pretty close to the iPhone X.
[0] https://www.apple.com/iphone/ [1] https://www.bestbuy.com/site/samsung-galaxy-s8-64gb-unlocked...
S8 - Geekbench single core: 2008, multicore: 6475
iPhone X wins by 60% to 105% on speed alone, and so would the cheaper iPhone 8 which has the same processor.
Apple Care, iPhone Upgrade Program, etc
You can imagine why the numbers would be different for iPads. Also, for people who are on the iPhone Upgrade Program, they are required to have Apple Care as part of the deal, so that plays a role as well. It drives up the ASP.
Or is “AppleCare+” different from “AppleCare”? (That wouldn’t fully surprise me, given that Apple tries to be as unclear as the SEC allows them to be in their reporting)
Have used the incidents in the past, got an as-new refurb after accidentally dropping on concrete / in water.
The iPhone X is either $1000 or $1200. Since they said it’s their best selling phone on a per week basis, it wouldn’t be hard for that to drive up the average selling price compared to last year.
> Also, iPads bring in less revenue per unit sold
They released the newest iPad last year, the one that is effectively and air to but only cost about $300. Since the entry level “modern“ iPad (not a model a few years old) used to be $500 it makes sense that they may have lower revenue per unit.
I guess what I am getting at is how long can they keep milking mobile? iPhones and iPads... are meh now. Now what?
I hear a few retail investors talking about apple acquiring Netflix. I believe that this is an acquisition that makes sense, and that it would complement nicely their other content distribution revenue streams.
And they should invest more into making their macbooks better imo, but they keep selling more and more year over year so they likely won't.
I wish they would buy a smaller telco like sprint or tmobile, hell buy both, invest 100B into getting the cell coverage up and then move then incentivise people to move to the Apple telco plan.
* Telsa's cash burn would likely scare investors.
/end arm chair CEO'ing
Netflix makes plenty of sense, I’d be happy with that.
I doubt they’d ever by Tesla, but if anyone could sort out the production issues they were having I imagine Tim Cook and his team would be quite good at it.
What are Sprint, Verizon, and AT&T going to do? If you’re Apple do you think they’re going to be willing to do lots of promotion with you? You’re now a direct competitor.
Maybe they’ll take you out of their stores. Maybe they’ll raise the price. Maybe they’ll just push other phones REALLY hard. Your sales are going to go down no matter what.
It’s nice you on the whole network, but now you have to support all these other phones. Do you think Apple Mobile wants to be in the business of selling in supporting Android phones? Maybe they kicked everyone off, maybe they just try and encourage people to move over to the Apple side of the fence. Either way you’re losing customers.
Your sales are down. Your customer count in mobile is down. The carriers are as mad at you or worse than they were when you first came around and suddenly had a lot of power. Your network isn’t good enough so the people who do stick with you or move to you aren’t going to have a great time because you simply don’t have a really big network. It’s going to take A LOT of time and money to fix that. You have money, but will people be willing to wait around?
If Apple wanted to do this they would’ve had to do it years ago when the iPhone with still relatively new.
And again, I don’t see the DOJ ever letting Apple do this. Ignoring questions of political goodwill towards Apple (which is VERY short), it would be a giant shake up of the mobile market.
Let’s say it works. Let’s say they’re allowed to actually buy T-Mobile. Now what? Is Google going to try and buy a carrier? We already know that Comcast wants to be in the cell phone game, are they going to try and buy a cell phone maker?
The stupidly large companies that shouldn’t be getting larger by taking over other industries problem will just continue.
I really like Apple. I do not want this to happen. And for the reasons above I don’t think they will do it.
Don't pretend these people are playing nice. Telcos hate Apple, and Apple doesn't care. You either get to sell the iPhone or you don't.
And the DOJ doesn't give a rat's ass about any company with ~20% of the market.
Unless it's e-books and Apple involved. In which case they do.
The DOJ’s current thoughts on antitrust seem to be “anything that might lower prices is good“. Apple certainly didn’t have a big chunk of the e-book market but it still got in trouble anyway.
The phone companies HAVE to put up with Apple because the phones sell too well. They tried hardball years ago and it didn’t work. Then they tried promoting competitors and it didn’t work. I think android being big was a foregone conclusion, but the promotion of things like the Droid didn’t push Apple to a marginal player like they wanted.
Frankly I think the current administration would be happy to put up a fight against Apple just put up a fight against Apple. I don’t think they should be allowed to become a phone company anyway, although I’m sure that wouldn’t be the real reason for the suit.
Realistically I think the shareholders would slaughter them due to the risk that the cash cow that is the iPhone would be injured in any way.
ln(1000/(4*88.3))/ln(1.13) = 8.51531Let's all just ignore the fact that the entire strategy is them saying they owe themselves all this money and for some reason we all just go along with this.
They're obviously not the only company that does this, most, if not all multinationals are guilty of this and people like to brush it off as "oh but it's not illegal", as if somehow the fact that they've managed to get a legal method of tax avoidance somehow makes it all better.
https://www.theguardian.com/world/2017/mar/23/apple-paid-no-...
https://www.theguardian.com/australia-news/2017/dec/07/austr...
https://www.theguardian.com/business/2017/oct/25/eu-to-probe...
They show off that they're environment-friendly, how about people-friendly?
America made it possible for them to start a company like that (could've happened in Italy, for instance), people gave the a shitload of money, and they don't pay taxes thanks to a loophole.
It doesn't matter if one is obliged by law to do something or not. I don't have to offer an old lady my seat on the bus, but what kind of piece of shit doesn't do that?
Debatable - some of us hold taxation to be tantamount to theft, so we believe in the exact opposite. I'm not here to debate or change your mind though, just offering a perspective.
> America made it possible for them to start a company like that....
What do you mean by "America" made it possible? Steve Jobs, Wozniak, and all the other people who worked there made it possible.
> people gave the a shitload of money,
No one "gave" them money. They voluntarily purchased a product or service.
> It doesn't matter if one is obliged by law to do something or not.
Yes it does.
> I don't have to offer an old lady my seat on the bus, but what kind of piece of shit doesn't do that?
That...is a ridiculous analogy.
How do you like those roads you've used to go to work or shopping. Or that power/water/gas infrastructure. Or the public health system. Or maybe the emergency services? How about the legal system?
They're all paid for by taxes. If you live in a country where this takes place the price is that you pay tax to contribute to the development, upkeep and use of said system. If you don't like it, I'm sure you can find a 3rd world country somewhere where you can fulfill your libertarian wet dream of building all your own infrastructure.
> What do you mean by "America" made it possible? Steve Jobs, Wozniak, and all the other people who worked there made it possible.
And what country did they live in that afforded them the education, resources and economy to support their work? People don't flock to America and SF to make startups because they like bay views and paying exorbitant rent. They go there because of the economic and social circumstances are favourable to starting and running a business.
Thanks for the reminder; and to think that I've spent a lifetime just assuming that public infrastructure grew out of the ground, like grass.
Look, I said I wasn't trying to change the guy's mind or debate. This isn't anything new, we've discussed this about a million times and I'm sure we'll never agree on the proper role and scope of taxation. My statement was simply a counterpoint to the completely undefended and unqualified idea that "Eluding taxes is super-unethical."
>And what country did they live.....
Ah yes, the cosmic effects that we must pay tribute to because we happened to be in the right place at the right time. If we're headed down that route, "America" deserves about as much credit as the invention of mathematics, or at the very least, the computer. Maybe we should thank Steve's mother. We can go down the line infinitely. The point is, people create, build, and make things, and it's those people that should be attributed and credited.
1. Social Security 2. Medicare and Health 3. Military
The other categories are tiny in comparison.
The only thing worth typing might be that the US have setup a business environment that allowed them to grow (which you take for granted).
If I started a company in my garage the Italian government would shut me down in a split second.
Sweden has a 20% corporate income tax rate. Finland is at 22%. Denmark is at 24.5%. The UK is at 17.5%. The average rate in Europe is 18%, in Asia it's 20%.
It is 26% in europe. Maybe it has changed a lot in the last few years.
[1] The “composed of” was obviously what Romney meant in the 2012 campaign, not an obscure argument about corporate personhood.
They said they would invest $N hundred billion in the US over N years. That almost entirely consists of payments to US suppliers / manufacturers, which comes out of operational cash flow; along with employee base expansion.
Who knows how much of the cash they'll repatriate, or when. They might not have even decided on that yet, the ink is still fresh on the tax changes.
[1] - http://fortune.com/2018/01/18/apple-overseas-cash-repatriati...
With the tax changes now taken care of, I'd like to see them begin reducing that immense pile of debt. You do it while times are good and you're pulling in $50b in net income, rather than getting caught in a very bad position later (which is overwhelmingly what most companies do).
In a very short amount of time, several of the leading tech companies have gone from being among the least indebted companies, to among the most indebted. Microsoft as another example, is carrying $76 billion in long-term debt, up from $27 billion in 2015. Their cash exceeds their debt, I consider that a very low bar to be setting though. Instead of bribing shareholders with buybacks (an indicator of lackluster growth opportunities in the business, when it comes to capital deployment opportunities), and artificially boosting EPS growth, that capital should all be going into paying down debt.
Certainly made sense before when Apple had cash overseas that they couldn't touch, but what would the benefit of it be now?
See: GE, Sears, US Steel, Alcoa, GM, Xerox, Eastman Kodak, Kmart, IBM. All former giants that were laid low. The only guarantee Apple has, is they'll face a critical point like those companies did. Having $200 billion in cash with zero debt, will sure beat having $50 billion in net cash, when that time comes.
Apple should know this better than anybody. They nearly went bankrupt 20 years ago, due to their fortunes turning south.
Even if the difference is like .5% that is billions of dollars.
I'm talking about tomorrow.
Here, I'll give you the obvious scenario.
Apple wilts. There are no exceptions, all the top corporations from each generation falter to one degree or another. The very few that are lucky or good enough, revive after taking a big hit.
Profits fall to $12 billion, or $25 billion. I'm not even modeling a loss scenario here, I'm being generous.
Shareholders are used to being bribed with fat buybacks, financial engineering. They also like the solid dividend, which then has to be slashed as the situation worsens. Simultaneously Apple has immense capital outlay requirements to maintain their margins. They're also bloated on labor, as they massively bulked up on employees and operational costs (the new HQ, and HQ2 et al.) during the extremely fat years, that means mass firings.
The market cap crumbles, 15 pe * $25 billion = $375 billion. Now shareholders are really ticked off.
$200 billion in debt. $200 billion in cash. Hey, debt is cheap after all, so why not.
Today their net income is more like $50 billion against ~$104 billion in long-term debt; a two to one ratio. Now make that ~$20 billion in net income against $200 billion in long-term debt; a ten to one ratio.
That $200 billion debt level will be reached in just four or five years at this point, if they don't stop accumulating at the rate they are.
Interest costs rise considerably as the market has a lot less confidence in Apple's prospects. How does just 5% sound on $200 billion, $10 billion in interest costs, while yielding $20 billion in net income. That becomes a debt hell, that is nearly impossible to get out of. This is not a reach, this is almost guaranteed to happen at some point if they keep pushing the debt up (unless one assumes the utopia outcome, where Apple is the sole exception in US history, and they just soar forever).
That's the medium outcome scenario. Feel free to model the bad scenario where the iPhone loses its place in the market. In that scenario, Apple goes bankrupt again circa 2030.
It could never happen, that the present Apple glory falters, everyone will say. My refutation: it has never not happened in US industrial history, that the top tier giants don't tumble (typically in a big way). Apple is far more exposed to that outcome than the very few corporate giants that have done it best over long periods of time, such as Exxon (even they just saw their profits contract toward zero when oil crashed).
And that's why you get rid of the debt.
Just ask GE how they feel about their present balance sheet (negative $32 billion in net tangible assets). GE was on top of the world not very long ago. They're not the same situations, skeptics will declare; of course not, they don't have to be, Apple will follow its own unique scenario of faltering, as all companies do.
BTW: the total number of shares is well known