Comment by chollida1 | Hacker News Reader

Comment by chollida1 | Hacker News Reader

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Numbers:

- Q4 wearables of $9.6B, beats est byu close to $1B

- Q4 Services Rev fo $19.2B short of Est by $800M

- Q4 iphone Rev of $42.6B meets Est

- Q4 ipad Rev of $7.2B, short of Est by $600M

- Q4 Rev of $90.2B beats Est by $2B, that also means its up 8ish% YoY

- Q4 Mac Revenue of $11.5B, beats by $2B, nice, forgot they make computers;)

- China Rev of $15.5B, this is interesting, AAPL clearly has alot of China exposure in a time when that can go away in an instant.

- declared a cash div of $0.23/share

Interesting:

- AAPL hiking prices on Apple One, up $2, Music up $1/month, TV up $2,

- they generated over $24B in cash

- they returned $29B to investors this quarter, wow, them and MSFT and cash flow machines, maybe the only two tech companies you want to hodl right now

- they have only spent $300M on acquisitions this year, that doesn't seem like alot.

Watch for:

- lots of currency exposure in this company, does the USD strength help or hurt them, or are they really good at hedging currency risk?

- AAPLE has $23B in cash, down 1/3 from this time last year. Mostly given back to investors. Probably nothing to worry about here:)

- $3 trillion in market cap has been lost in the past year among 7 of the biggest stocks. $GOOG $MSFT $META $AMZN $TSLA $NFLX $AAPL( from twitter)

- from bloomberg, Maestri said Apple will likely see 10 percentage points of currency impact in the first quarter.

That is alot, and a significant headwind. That could be an entire paypal worth of currency drag

Guidance provided by AAPL

- revenue growth will decrease going into Q1

- mac revenue to decline substantially

I will admit publicly this post is so terse yet comprehensive I am aggressively searching your history on this site for more nuggets like this one.

UPDATE …and, not disappointed. World-class commentary. Not sure how PP flew under my radar so long.

Agreed! Is there a website that does this style of commentary for (tech) stocks?

All I see is seo spam when looking.

> Not sure how PP flew under my radar so long.

Apple? People? What do you mean with PP?

Parent poster

Parent poster, I believe.

appreciate that, thank you!!

I would love any personal background you’re willing to share just because your writeups are lapidary. Do you do this professionally? how do you decide what to cover? Seems like a broad array of tech stocks but maybe you cover other companies that you just don’t mention here at hacker news?

Again, absolutely none of my business. I’m just fascinated with how great minds operate.

Could easily be a SAAS

There are a few big ones out there. For example, one of them made Mike Bloomberg a billionaire.

better than a google search

So Apple Watch and AirPods is almost as big a business as the Mac. Wow, I didn’t realize that.

Quite a vindication of Tim Cook’s decade at the helm.

Don’t forget Tim Cook also brought you crummy gambling ads next to gambling addiction recovery apps on your $1500 phone.

Only if you open the App Store… Which I practically never do. The apps on my phone have been essentially the same for years. If I ever install something, it’s probably through a web link or QR code that goes straight to the right app.

The App Store is clearly a big wasted opportunity. 12 years ago I was actually eager to find new apps there. Why did Apple let it become a slum?

Yeah, it's pretty incredible wasted opportunity. I think maybe 5ish or so years ago they did a big revamp which shifted the focus to obviously coordinated promos of big company stuff, and a more, I don't know, fluff editorial format, and it just become completely uninteresting as a discovery vector.

It's absolutely outrageous that they run confusing ads next to search results -- probably millions of people getting confused and having a bad outcome because of that. Just straight up selling out a good user-experience for $. Shameful.

Wow I really never spent time thinking about it as a product but yeah it really was a wasted opportunity. Discovery is terrible and the quality of a lot of the apps are poor. It's obviously not an easy problem to solve but still I only go to the App Store to specifically get the app that I need.

>It's obviously not an easy problem to solve

It probably is at least relatively. The problem is that you (or at least a lot of people) wouldn't like the answer. Make it a very curated marketplace. Yes, that would take some labor but you can also take into account ratings etc. (Though not sure how to deal with the legit crappy online banking app that people give low-ratings too.)

But cue the outrage over my app dropped below a 4.0 rating and Apple kicked me out of the App Store. Or Apple decided I wasn't popular enough. Or any of the other ways in which curation produces losers that will be at least somewhat arbitrary at the margins.

You have two tabs: curated, and what's popular.

Across all of the apps that I use to consume content, I only know one app that does this well: Criterion. Here, look:

https://www.criterionchannel.com/browse

First thing to note. You can browse w/o having to create an account!

You know what else Criterion does? Rather, what it doesn't do? It doesn't cut off the end of movies at the credits to spam me with what it thinks I want to watch next. There's no "you may like this other thing" based on my watch history. Rather, content is grouped already based on attributes of the movies, not based on my watch history.

Criterion cares about movies and about me as a movie watcher, and it shows.

I will pay Criterion $99/year till the end of time.

The only thing I'd like them to improve is their streaming quality a bit. The video stream is okay, but none of the soundtracks are anything but stereo at best, even for movies they also sell as Blu-ray that have multi-channel DTS soundtracks.

Criterion's app is nice but their movie selection is ... not great. I've watched a good portion of their films and less than half have turned out to be worth watching.

But this is no surprise. Per this quora answer by Larry Wright ( https://qr.ae/pvlbgP ) -

> Note that Criterion is a video distribution company. One may still wonder exactly whom makes the selections and with what credentials. Co-founder Robert Stein's background is in electronic publishing. Co-founders Joe Medjuck and Roger Smith produced such Criterion-unworthy fair as "Stop! Or My Mom Will Shoot!" and "C.C. and Company" (respectively). One must assume that they employ a crack team of film historians, critics and assorted movie geeks to curate their titles.

Different strokes for different folks. I watch a lot of old films. My letterboxd watchlist currently contains 365 films which can be streamed thusly:

69 are available on Criterion. 61 are on HBO. 22 are on Amazon Prime. 17 are on Netflix. 15 are on Hulu. 6 are on Disney+.

240 are available as rentals on on iTunes.

(And I have no idea who Larry Wright is or why I should give any credence to his snarky remark where he picked two films that are not at all representative of the full Criterion catalog and neither of those films are currently on Criterion in any case. To pick a random selection of 5 on Criterion from my watchlist: Story of Women, White Material, Woman in the Dunes, Piccadilly, The Thin Blue Line.)

Criterion has definitely been historically film classic/art house oriented. Which, even as a generally film buff, doesn't necessarily line up with what I want and definitely may not line up with a Saturday evening when I just want to relax.

I also remember trying out different new apps on the daily in 2010.

If only those had costed $15 instead of $1, apps might not have become a race to the bottom where the only way to make a buck was to offer shady IAP or to release an uninspired boilerplate app filled to the brim with ads.

> Only if you open the App Store… Which I practically never do.

Which also says a lot about Tim Cook's tenure. They are facing major regulatory scrutiny due to the App Store, in addition to it being a major knock on their brand, instead of it being the asset it once was.

It's a leadership problem, for sure.

Basically the same reason Amazon let marketplace become a slum. It’s an open platform and becomes a race to the bottom and full of junk and spam and whoever wants to pay for ads for their junk and spam.

Which is wild to say, because it really isn't a very open platform. It's just open enough to be a cesspool while being policed enough to piss off developers and regulators.

So like... worst of both worlds. Nice.

>Why did Apple let it become a slum?

They gambled and lost.

It appears that they can't stop the gambling.

Other than maybe games I'm not really sure why/how the app store itself would be useful for discovery?

I think when most people got a phone it was novel to have an app for different purposes - but nowadays people only really want apps they will use. They already have dozens they like so something has to be offering something unique.

And when it comes to finding a new app (like how I recently picked a new app for cycling) just seems like youtube and reddit forums are always going to have more info than an official marketplace.

They let it become a slum because they make bank off it. See their services revenue: it’s huge. Sad, but expected.

For the record, they have now stopped serving gambling ads. As well as a few other categories.

Although this is not ideal, it's also basically not an issue for me. I spend approximately 5 min a month in the App Store.

However, I do a perceive a slight sheen on the slope.

> Don’t forget Tim Cook also brought you crummy gambling ads next to gambling addiction recovery apps on your $1500 phone.

This was obviously an oversight and the ads were halted when this came to light. Apple has never been good at dealing with ads, which is probably good since we don’t need a single company to takeover all markets.

I used to blame Tim for design decisions that lead to the keyboard fiasco and the touchbar (I just felt like it never would have happened if Jobs was still there).

After seeing the tremendous success that he's lead the company to my view has softened a bit. Even if those atrocities might have been avoided if Jobs was still around, there's no denying at this point that Tim was the right choice for CEO.

> I used to blame Tim for design decisions that lead to the keyboard fiasco and the touchbar

Was that Tim or Ive?

Tim was CEO when I personally noticed the keyboard issue on my own devices, and I admit I wasn't paying much attention before I started having problems. I really don't know if Tim made that call or not, I only know that he was around to blame when it affected me.

To the regular consumer both of those things are tied to the same ecosystem as the iPhone and people want to be seen in public with the latest gadgets. I'm not sure people feel that way about buying a new Mac.

Most iphone users use a case, then it looks like every one made in the last 5 years

This is a vindication for Johnny Ive, who completely founded pitched and launched the projects. Cook is a vision less hack who is chased off the golden goose.

> Quite a vindication of Tim Cook’s decade at the helm.

Agreed, if all you care about is Apple getting richer, he's done an outstanding job.

And making the best Macs of all time (and best laptops in the industry), and the best wireless headphones, and the phone with the biggest market share (one measure of best).

I think Tim Cook’s Apple is doing very well

We have very different definitions of "best".

wow what a fucking applefanboy fest it is in here... grow up guys, people have different opinions.

> AAPLE has $23B in cash, down 1/3 from this time last year. Mostly given back to investors. Probably nothing to worry about here:)

Didn’t they have over a hundred billion in cash reserves a while back? This seems significantly low compared to what it used to be.

Mac revenue will be down next year but whenever they release the M3 on the 3nm node I think they’ll have another bumper year. Probably 2024.

Also Apple Glass is coming next year. I can see uptake on that being a lot quicker than Apple Watch but all depends on pricing, especially going into a global recession. If it’s over a $1000 it’ll flop. If it’s $500 it’ll do well.

Edit: looks like apples cash reserves peaked around 2019 at $107 billion dollars.

https://www.macrotrends.net/stocks/charts/AAPL/apple/cash-on...

> If it’s over a $1000 it’ll flop. If it’s $500 it’ll do well.

I think we'll have to wait to see what the capabilities are. If it can replace an iPhone, $1000 would be incredible. $500 is only double the price of AirPods Pro, so functionality would have to be pretty limited.

I agree somewhat, in that if the capabilities are shown to be indispensable to achieving a person’s goals or the product becomes a new social norm like smart phones then people may be willing to spend that much. But the $1000 barrier is a steep one. There’s a lot of push back for that on phones as it is and they’re a practical necessity in modern society.

It’s going to take a lot of time for Apple Glass to build up the ecosystem to the point where it meets that indispensable criteria and that time will only increase if there are less users on the platform due to high entry costs. I bought a 1st gen Apple Watch and ended up selling it shortly after because I just didn’t use it. The first gen was a pretty terrible product. It’s come on a long way but it’s only now with the Ultra watch that I’d consider buying again. That’s seven years and I’m a tech person. Your average guy in the street is less inclined to want to purchase.

Maybe, but Apple Watch was a device you could buy on day one and be pretty confident in - at least in terms of what you were getting and that it would work for what it is.

Apple Glass at $1k is not something I could buy day one even if I really liked the promo video. I'd need to see some reviews after weeks and how well the first version works before jumping in - I imagine a lot of people would feel that way - because it seems like something that could so easily just not quite work.

(I don't mean not work in the full-of-bugs way, more like the it-was-a-better-idea-on-paper way).

> looks like apples cash reserves peaked around 2019 at $107 billion dollars.

Cash peaked in 2018 with twice that.

I thought TSMC is taking 3nm to volume production starting Q4 22/Q1 23. Why would the 3nm mac processor be on hold until 2024?

I don’t think personally they will make the M2 Pro and Max MacBook Pros as 3nm as they’re due next month. I think you might see an M2 Ultra chip at 3nm for the new Mac Pro. I think they’ll wait a year before they release new M3 MacBook Airs and Pros which means you won’t see them appear until either end of 2023 or sometime in 2024. We might even end up in an odd situation where the iPad Pro gets the M3 before the laptops. Could be completely wrong though, just my speculation.

I think because they haven't even announced the M2 14 and 16 inch Macbook Pros yet, which would be on TSMC 5nm like the rest of the M2s. Not to mention the mac mini, studio, and pro.

It would just seem kind of weird for them to announce an M3 on 3nm within the next 14 months given that.

Still not a single crack in its business. And finally making inroads in SEA and India.

A company that is beautifully packaged but arguably has lost most of its soul. And is strategically building up the Chinese Supply Chain and helping them to move up its value chain. While presenting itself as the defender of Fundamental Human Right.

> AAPLE has $23B in cash, down 1/3 from this time last year. Mostly given back to investors. Probably nothing to worry about here:)

This is the lowest cash level since 2014. Actually, concerning going into potentially a recession.

With inflation what it is, don’t you actually want to be holding less cash?

Inflation is a lagging metric. Not a forward looking metric. Hypothetically, todays inflation could be 10%, and if within the next year broad market prices drop 30% YOY, next year inflation numbers would report negative. Meaning you would have been better off holding cash when the inflation numbers were previously stated to be 10%.

They can issue more equity if they need to.

> or are they really good at hedging currency risk

How would they be exposed on this, long-term?

Euro stronger than dollar: convert prices 1-1. I saw someone do a calculation that EU customers overpaid ~38% (!) on Macbooks in 2009. Yes, that's with VAT (sales tax) removed.

Dollar stronger than euro: immediately horrendously jack up the prices.

By “est”, you mean estimates made by people who have nothing to do with the company, not by Apple themselves.

The people "who have nothing to do with the company" are the ones who buy or sell the stock, and end up dictating what the price action would be post earnings call.

So you're technically correct, but it doesn't change the fact that the estimates done by analysts materially influence stock performance.

In the United States, the research arm of banks are explicitly forbidden from working with the investment arms. So they are not the same people.

That makes no sense

The idea is aligning profit motive of investment with profit motive of selling analysis makes it too tempting to engage in price manipulation.

Sure - but the point is that it is an indication of their sentiment, rather than anything to do with the running of the company.

I.e. it’s a reflection of their position, not Apple’s.

Somewhat, they are typically generated by the analysts whose job it is to follow the company.

However, Those analysts typically get their numbers in large part by talking to the investor relations/CFO of these companies so the estimates are usually pretty good.

Apple has declined to provide guidance for some time now.

somewhat.

They still provide some guidance on numbers both magnitude and direction, but don't release actual estimates.

I'm confused now.

You claimed to not really understand who makes these estimates and have no knowledge about how they are formed but it sounds like you do know a tiny bit about guidance?

I mean you literally asked how these estimates were created?

Another reply since you edited your comment to add this:

> I mean you literally asked how these estimates were created?

Honestly, you genuinely seem confused. Where do you think I asked that question?

> I'm confused now.

Agreed.

> You claimed to not really understand who makes these estimates and have no knowledge about how they are formed but it sounds like you do know a tiny bit about guidance?

Where do you think I made this claim?

Sure, but like it or not, performance against those third-party estimates has a big impact on stock performance.

True. However this doesn’t mean as much as pre-covid when Apple did provide their own estimates.

next numbers on iphone 14 will be bad. the phones are much more expensive in europe than they were a few years ago. exanging my 12pro for a 14 pro costs me 500€$ in the US and 800$ in europe.

Great comment summarizing Apple financials, thank you.

Forget the China revenue, what about the manufacturing? How would Apple survive at all if the US and China were cut off from each other?

Slowly shifting the ship to India and Vietnam but it’s going to take time.

You sound like someone who likes to get the details right. "A lot" is two words.

Complimenting while correcting. Nice. I may have to try that sometime ;-)

ha, thanks!!

> chollida1

can i subscribe to this newsletter

What a company.

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