THE APPLE INVESTOR: Apple Has It All Wrong According To Microsoft

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Wrong Way


AAPL Up With Markets
Markets are up in early trading despite a slight increase in inflation as indicated by June PPI figures. Shares of AAPL are up nearly 1%. Apple will report earnings for its third fiscal quarter on Tuesday, July 24. Shareholders are earning a dividend as of July 1. Investors remain focused on iPhone penetration globally and the anticipated launch of the next generation in the fall; iPad adoption and the rumoured launch of a smaller version; market share growth of the Mac business lines; the introduction of the anticipated Apple TV set and related products; and evolution of platforms such as Siri, iAd and iBooks. Shares of Apple trade at 9.5x Enterprise Value / Trailing Twelve Months Free Cash Flow (including long-term marketable securities).According To Microsoft, Apple Has It All Wrong (Daring Fireball)
At Microsoft’s WPC this week, Kevin Turner, took to the stage and waxed philosophical: “Apple makes great hardware,” he admitted, “the reality is in the OS we see things differently. We believe that Apple has it wrong. They’ve talked about it being the post-PC era, they talk about the tablet and PC being different, the reality in our world is that we think that’s completely incorrect.” Apple’s post-PC vision isn’t about input devices. It’s about exposed complexity. Some say Apple’s “post-PC” and Microsoft’s “PC-plus” aren’t that far apart. That remains to be seen. With the iPad, Apple has eliminated large amounts of complexity. With Windows 8, who knows whether Microsoft has eliminated complexity, or merely hidden it.

Analyst Ups iPad Estimates, Says Will Eclipse iPhone Eventually (Apple Insider)
Apple is poised to report record breaking sales of 20 million iPads in the just-concluded June quarter, according to Charlie Wolf with Needham & Company. He increased his June iPad shipment forecast from 13.5 million units to 20 million units saying, “In our view, it’s only a matter of time before iPad shipments exceed iPhone shipments. The iPad is invading the business market at a much faster pace than the iPhone. In addition, the iPad will launch in China on July 20th. This should provide a significant boost in sales now that Apple is providing Chinese languages and services on its iOS platform.”

Why The iPad Mini Makes Sense (BI Intelligence)
After wading through various reports and analysis pieces, Matt Rosoff at BI Intelligence believes Apple has very good reason to make a smaller iPad:

  • Proven demand (Kindle Fire)
  • Cheaper content consumption device
  • Better remote control
  • Prevent disruption to the iPad

Apple may have purposely leaked the rumours now in order to freeze the market, hoping that consumers would hold off on buying the Nexus 7 or next Kindle Fire to wait for Apple’s offering instead. Subscribe to read more.

Research Firms Diverge On Apple’s Mac Sales During This Last Quarter (Barron’s)
Both Gartner and IDC recently reported that PC sales fell 0.1% during the second calendar quarter ending June. What they disagreed on where Apple’s results. Gartner reports Apple having experienced 4.3% shipment growth, to 1.9 million units, for 12% share, and third place behind Dell in the U.S. Gartner says that Apple was the only vendor in the top five to see growth in the U.S. market. However, IDC has Apple sales declining 1.1% to 1.8 million units, or just 11.4% share. Well, we’ll know soon enough!

The U.S. Government Reconsidering Mac Purchases (Politico)
Following the city of San Francisco, the U.S. Federal Government is reconsidering Mac purchases in the wake of Apple withdrawing products from EPEAT certification. Federal officials who focus on sustainability issues met Wednesday to discuss the question and will seek a meeting with Apple soon. Federal procurement decisions for fiscal 2013 are being made now and officials are worried that the government’s efforts to buy environmentally friendly products will be set back. “Apple’s competitors are looking at this and saying if they can get away with this maybe we can too.”

2 Out Of 3 New Mobile Phone Buyers Opting For Smartphones (Nielsen)
During the second quarter, smartphone penetration hit 54.9% of U.S. mobile subscribers. This growth is driven by increasing smartphone purchases: 2 out of 3 Americans who acquired a new mobile phone in the last three months chose a smartphone instead of a feature phone. Android continues to lead mobile operating system market in the U.S., with a majority of smartphone owners (51.8%) using an Android OS handset. Over a third (34.3%) of smartphone owners use an iOS. Apple had the highest manufacturer share of smartphone handsets with 36%. Do you know anyone without a smartphone?

iPhone / Android Users Most Likely To Vote For Obama (Various via Scoople)
In a survey was conducted online by Harris Interactive among nearly 800 iPhone and Android smartphone owners, 49% per cent of smartphone owners surveyed reported they’re planning on voting for Obama, while only 31% said that Romney’s got their vote. At present, traditional presidential polls show Romney pulling slightly ahead in the race when Americans are surveyed, regardless of smartphone preference. Do you believe that most iPhone users are for Obama?

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