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Apple Announces Most Profitable Quarter in History 761

Posted by Unknown Lamer
from the that's-a-lot-of-zeros dept.
zacharye writes with an except from an article over at BGR about Apple's quarterly results: "'Disappointing' though it may have been to some, the iPhone 4S propelled what is now confirmed to have been the most profitable quarter any technology company has ever recorded. Apple on Wednesday reported record earnings for the December quarter, revealing a profit of $13.06 billion on revenue that surpassed $46 billion. Among technology companies, Apple's fiscal first quarter represents the most profitable quarter ever recorded. Only one U.S. company has ever posted a more profitable quarter — Exxon managed a profit of $14.8 billion in the third quarter of 2008 — and the driving force behind Apple's record-setting performance was quite clearly the iPhone."
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Apple Announces Most Profitable Quarter in History

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  • Nokia and RIM (Score:5, Insightful)

    by vakuona (788200) on Tuesday January 24, 2012 @06:41PM (#38812863)

    Nokia and RIM should read and weep. This should have been them.

    • by ackthpt (218170) on Tuesday January 24, 2012 @06:44PM (#38812903) Homepage Journal

      Nokia and RIM should read and weep. This should have been them.

      Poor choices of business partners and lack of vision on the part of RIM, nothing new there. Someone has to win.

      I imagine Steve Ballmer needs a new chair at the moment. So that's a plus for the local office furniture outlet he buys from .. expect them to declare a good quarter, too.

    • Re: (Score:3, Insightful)

      by clarkkent09 (1104833)

      They didn't have Jobs. When he came back Apple was almost bankrupt and had to be rescued by Microsoft. It took great vision to take a nearly broke computer company and take on the most contested markets like consumer electronics and music and win through quality and design of the products alone. And I'm not even an Apple fanboy.

      • Re:Nokia and RIM (Score:5, Informative)

        by R3d M3rcury (871886) on Tuesday January 24, 2012 @11:33PM (#38815299) Journal

        [...] and had to be rescued by Microsoft.

        I'm not sure that's entirely true.

        One of Apple's biggest problems at the time was that they were going out of business. It was all over the news, in case you missed it. Apple was going out of business. Everybody knew Apple was going out of business.

        Now, would you buy a product from a company that everybody knew was going out of business? Would you consider selling parts or components to a company that everybody knew was going out of business? If you would do so, would you offer them decent credit terms? Of course not--they're going out of business! Everybody knew that Apple was going out of business! You'd be crazy to offer them any kind of credit because they'd go out of business and you'd be left trying to collect pennies on the dollar in bankruptcy court.

        It's tough to build iMacs when you have to pay cash up front for parts.

        Microsoft's cash investment was $150 million in common stock--remember that, at the time, Apple had something like 4 billion dollars in the bank. So the dollar amount wasn't that much. It was more the press of Apple being aligned with Microsoft to basically shut up all the "Apple is going out of business" people. Once everybody decided that Microsoft wouldn't let Apple go out of business because then Microsoft would be a monopoly (of course,, Microsoft tried to play the Apple card during their monopoly trial and the judge decided that Apple was not a competitor of Microsoft), Apple was able to get better terms.

        I will agree that Microsoft "rescued" Apple. But the rescue was more in the terms of reputation than in cash.

      • Re:Nokia and RIM (Score:5, Insightful)

        by jcr (53032) <jcrNO@SPAMmac.com> on Wednesday January 25, 2012 @12:49AM (#38815673) Journal

        had to be rescued by Microsoft.

        Nope. MS put in $150M as a token investment. The main point of that deal was that MS promised to keep shipping Office on the Mac for five years, and Apple let them off the hook for stealing Quicktime code for Windows.

        -jcr

    • Re:Nokia and RIM (Score:4, Insightful)

      by Proudrooster (580120) on Tuesday January 24, 2012 @08:51PM (#38814139) Homepage
      I agree.. The new iPhone is really, really well done. Siri is so simple that my grandma can use the iPhone. This is clearly a time where profits were earned through innovation and delivery, not just accounting tricks. Exxon being the second closet company gets their product for nearly free, so this is definitely an accomplishment. The question is, without Steve is this sustainable.
  • WebOS (Score:5, Interesting)

    by slashgrim (1247284) * on Tuesday January 24, 2012 @06:42PM (#38812875) Journal

    As a WebOS fan, this makes me sad. Why would HP give up on such an incredibly profitable market after only investing $3.3billion http://techcrunch.com/2011/11/21/hps-failed-webos-experiment-cost-them-3-3-billion-but-whats-next/ [techcrunch.com] ? The iOS and Andriod user experiences still have not passed WebOS smoothness, in my opinion, though the notification systems are catching up.

    Although HP's management style of WebOS reminded me of: "They say you gotta spend money to make money. I don’t know what went wrong. We spent all our money." - Tom Haverford

  • American jobs (Score:4, Insightful)

    by Anonymous Coward on Tuesday January 24, 2012 @06:54PM (#38813025)

    And yet Apple couldn't manufacture iPhones in the US because they couldn't afford the extra $49 it would cost to make iPhones here. It might shave a few millions off of those billions. Can't have that happen!

    • Re:American jobs (Score:5, Insightful)

      by randy of the redwood (1565519) on Tuesday January 24, 2012 @07:53PM (#38813683)
      Not to be pedantic, but if your $49 is correct, that would be just under $2 BILLION in reduced profits if they did it in the US for last quarter alone. According to the press release, they sold over 37 million phones last quarter.

      I think if I went to my boss and suggested it would be a patriotic move to build here and it would only cost us $8 billion a year, I would probably be looking for work.

      I am a big fan of building in the US, but let's look for products like construction equipment (that take large amounts of natural resources we have, and are expensive to ship), and do those first. (See Caterpillar for a success story like this). When China's economy has caught up to ours (they want Lattes too), then we can look to compete on things like electronics that are cheap to ship.

      • Re:American jobs (Score:4, Informative)

        by artor3 (1344997) on Tuesday January 24, 2012 @08:34PM (#38814005)

        Considering that the only reason Apple exists is because of American prosperity, they have a duty to aid in the continuation of that prosperity so that the innovators of the next generation receive the same benefits that they did. Reducing their profits by $1.8B out of $13B is not asking all that much... only about 14%. Less than Mitt Romney pays in taxes!

        Besides, pumping an extra several billion dollars a year into the pockets of middle class Americans will increase the sales for all Apple products, so the actual cost to the company would be less.

        If they don't do it voluntarily, slap a 15% tax on overseas production and give that money to the poor and unemployed. It would be more efficient if they did the right thing by choice, but if they don't, we should obtain the effect by force.

  • by chill (34294) on Tuesday January 24, 2012 @07:06PM (#38813203) Journal

    When Exxon posted those profit numbers people were screaming for a windfall profits tax. Where are those people now? Probably listening to their iPod, tuned out to the world.

    • by Microlith (54737) on Tuesday January 24, 2012 @07:12PM (#38813269)

      Unlike Apple, Exxon deals in commodities with inelastic demand. It could be argued more readily, I suppose, that Apple actually earned those profits while Exxon gains them purely of virtue of having pumped it out of the ground. YMMV.

      Personally, I would have more respect for Apple if they started paying a dividend.

    • As others explained already, oil is a commodity. Regular gas costs the same whether you're well off and bought a decent new car for $25,000, or if you're a broke student forced to buy a used $500 clunker.

      No one forces you to buy a luxury item, and people don't complain much about phone prices because there's plenty of choice, at different price points. They'll rant about the ridiculous monthly fees, of course.

  • Scaled Tariff (Score:5, Insightful)

    by WindBourne (631190) on Tuesday January 24, 2012 @07:11PM (#38813259) Journal
    We are LONG overdue for America to implement a scaled tariff. Basically, These are tariffs that target nations that we have large deficits with, but in particular, those that manipulate their money and markets against us: [americanthinker.com]

    This would not only restore manufacturing, but it would also improve our tax base, rather quickly. Finally, it would force nations that we have supposed open markets with that manipulate against us to change their behaviors.
    So, for our top 20 nations that we trade with, this would punish the following:
    • China - 36%
    • Venezuela - 28%
    • Italy - 25%
    • Germany - 24%
    • India - 22%
    • Japan - 16%
    • South Africa - 14%
    • Mexico - 13%
    • France - 12%
    • Taiwan - 8%

    While giving other nations like Canada a pass:

    • Argentina,
    • Australia,
    • Belgium,
    • Brazil,
    • Canada,
    • Hong Kong,
    • Luxembourg,
    • Netherlands,
    • Singapore,
    • South Korea,
    • United Kingdom

    Interestingly, this is legal PER WTO. WTO's position is that when a nation's trade deficit is larger than 10% with another, than you may take action.

    The trick here is to convince the neo-cons that are attached to China's pants to let go and back America instead. Right now, far too many neo-cons are the ones blocking efforts at a balanced trade. In addition, without a budget deficit below 500 billion (or so), this probably becomes impossible to do.

    • Re:Scaled Tariff (Score:5, Insightful)

      by jo_ham (604554) <.moc.liamg. .ta. .999mahoj.> on Tuesday January 24, 2012 @07:25PM (#38813409)

      Or instead of crippling yourselves with trade manipulation you could just repeal the Bush Era Tax Cuts - there's 2 trillion right there, that barely touches the bottom 90% of earners and yet will cost the US 2 trillion dollars - more than twice the "expensive, wasteful, ill-affordable" healthcare bill.

      Get your house in order before blaming countries like Germany, who have built a very strong export economy, for harming your own. You'd hardly say that Germany was in the position it's in by being like China in the way it goes about becoming a large net exporter - this is not simply about "restoring manufacturing" - it's not as simple as that by a long shot.

      • Re:Scaled Tariff (Score:5, Insightful)

        by artor3 (1344997) on Tuesday January 24, 2012 @08:27PM (#38813977)

        The Republicans took millions of people hostage last time we even talked about reducing the Bush tax cuts. They'd burn the country to the ground before allowing them to be dropped entirely.

        When ~50% of your government is insane, evil, or both, the best course of action is usually unavailable. We've got to work with what we've got.

    • Re:Scaled Tariff (Score:4, Insightful)

      by RobertinXinyang (1001181) on Tuesday January 24, 2012 @08:48PM (#38814113)

      What is interesting to me, with the continual WTO talk, is that imports are taxed heavily in China. The item does not even need to be an imported product, it only needs to be an imported brand.

      This means that even if the product is made entirely in China, if the brand is significantly foreign owned then the item is taxed at a rate that is equal to the amount that is projected to leave China due to the purchase. Tax code is actually a bit more complicated than this; but that is basically how it works.

      This allows the Chinese branded competitors to the American and German brands to establish their production process, allowing them to compete internationally. To the Chinese consumer the result is higher prices.

      Part of the reason for the higher prices is that the Chinese manufacturer does not need to offer the item at a lower price, or even the the same price as the, Chinese made, item is sold for in the US and EU.Like I have mentioned here before, it is cheaper for me to have friends in America purchase items like smart-phones and computer and mail them to me in China than to purchase the item in China. Even most household goods, other than the most basic items manufactured by "not for export" companies, are more expensive in China.

      Right now China is playing both sides, they are calling to the WTO when anyone considering responding to China's practices and the results of those practices. At the same time China is crying, "oh, pity poor China," when anyone considers demanding that China obey the same rules that it demands that others abide by.

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