When Apple exceeded its expectations and its stock collapsed

The day before yesterday, Apple officially announced the results of its first fiscal quarter for the year 2018, which are October, November, December 2017, and in this report, Apple exceeded its expectations, the same that it had announced before the beginning of the quarter, and also issued expectations for the second quarter better than the same for 2017, and despite this, Apple's stock quickly collapsed In the financial markets, the company lost more than $ 40 billion of its market value in just 6 hours. So what happened?

When Apple exceeded its expectations and its stock collapsed


Results

Of course, you came across the results while browsing the news for the past two days, but we are quickly re-telling them:

◉ Apple's total sales increased 13% to $ 88.29 billion last quarter, compared to 78.35 billion in the same quarter of 2017, while its forecast was $ 84-87 billion.

◉ Apple's sales increased in all regions of the world without exception, either compared to the same quarter or the previous quarter directly.

◉ iPhone sales decreased 1% to 77.3 million compared to 78.3 million, but revenues increased 13% to $ 61.5 billion

Apple became the largest smartphone manufacturer during the last quarter of 2017 (not this year), 3 million more phones ahead of Samsung, which ranked second.

◉ iPad sales increased by 1% and revenue 6%, to reach 13.1 million devices, valued at $ 5.8 billion.

◉ Mac hardware sales decreased by 5% as a number and 5% as material revenues, with a total of 5.1 million devices, valued at 6.89 billion dollars.

◉ Apple’s collection of services increased by 18% to $ 8.4 billion.

◉ Apple's revenue from sub-devices increased to 5.48 billion, or a 36% increase.

Apple expects to achieve revenue of $ 60-62 billion next quarter, compared to $ 52.8 billion in the same quarter last year.

◉ Apple expected the tax item to become 15% to 25%.

The results and numbers are great, right? So why did Apple stock crash?


IPhone password

As usual, the key for Apple is the iPhone, as it represents approximately 70% of Apple's revenue, meaning that more than double everything else, whether the other is the iPad, the iPod Mac, the Bates family, the software store ... etc. etc. All this is 30% and the iPhone 70% The viewer of the numbers says that the decline is slight, as instead of 78.3 million, it has become 77.3%, i.e. 1% decrease, while the smart phone market as a whole has decreased between 6-8%. And you might also say that Apple’s revenues have increased by 13%. So where is the problem?

Let's analyze the situation and look at it in more detail. As for the decrease in the number, yes, 1 million is a slight number, but given that the same quarter Apple used to sell the iPhone 7 and 7 Plus. And this quarter was 8, 8 Plus and X which device increased and sales decreased? This is a clear reversal. If you look at a 13% rise in revenues, this is due to the fact that Apple increased the average price of the iPhone by $ 100 to $ 795 instead of $ 695, meaning that there are approximately $ 8 billion that came thanks to the price increase, not the improvement in sales.


Apple's Wealth and Future

Economic analysts from global banks such as Bank of America; Deutsche; City; Barclays, as well as financial institutions, agree that there is concern about Apple's future for many reasons, the most important of which are:

1

Apple fortune: Apple said at the conference that its debt has reached $ 122 billion and cash is $ 285 billion. She explained that the difference of $ 163 billion difference will be used in the purchase of shares of the company and cash dividends as well as acquisitions. The company's possession of liquidity equal to 20% of its value is a matter of concern, especially with its announcement that it will buy its shares because this means its ability to intervene strongly in the share price and this worries investors.

2

the future: Investors worry about the company's future; Even with its decision to increase the phones to 3, there was no increase in sales. And the company failed to develop any other products or sectors that reduce the weight of the iPhone and its impact, and it is dangerous for a huge entity like Apple to be dependent on only one product.

3

Negative news: A lot of negative news spread about Apple and the future of the iPhone, but the company, by announcing a decline in phone sales, gave this pessimistic news additional weight, and the company did not seek any assurances about the future of its device.


Conclusion:

Apple is a company that depends only on the iPhone and failed to significantly increase its revenue from any sector, which caused a crisis because at the same time it increased the iPhone family to 3 devices, but did not increase sales. So there is a fundamental problem with the company and concern for investors who want a long and secure future, not short-term successes.

What do you expect for the future of Apple? Do you think that investor concern is really justified?

40 comment

comments user
Samir

Marvel at those who say that the strength of Apple is in its system !! The origin of Apple's problems is its system, how many updates Apple pays from time to time in order to fix the holidays and the problems in it, and while a problem is fixed in the iPhone 6, for example, another malfunction appears in 7 and so the company keeps pushing boring updates until the system is stable and it is very difficult The user has hated himself, so the lack of updates in the Android system is a strength for him, not a weakness, as only iOS users miss

comments user
Samir

Some of Apple’s analogies with historical companies such as Mercedes, BMW, Sony, Samsung and so on are a risky analogy because those companies work in a balanced manner and do not use the boom and expansion based on interim successes. Rather, they work to ensure that the market is going through two situations: the state of prosperity and one should not rush and go with it to The end is because the end is a decline that may be very steep, and a state of decline. We should not stop and disrupt the wheel of development, because it is a stage that will end. Apple, since its great revolution, has not stopped expanding and building a branching empire that depends on the state of the ever-booming market, and this is impossible. What happens to the company in terms of fluctuations, especially with regard to its credibility, is a harbinger that the company is on its way to start the stage of the downward market situation and is not ready for this stage, so it is You will suffer a lot, and you may face an unexpected fate, and the US government itself may intervene to save the company, and this is not excluded for those who read things neutral and unemotional reading.

comments user
Mohammed

I expect the subject to be normal, and this is excellent for Apple customers. Last year, Apple presented devices that are not acceptable, neither financially nor technically, and continues this approach until their sales decrease, and I hope that it will continue to decline naturally.

comments user
Mohm22

The analysis is correct, but it is also possible to tell about the decrease in iPhone X sales, which could be one of the reasons
The first time I read in Yvonne Islam a neutral article

comments user
Staff Assaf

The crisis is not in Apple shares, nor is it a crisis of investors in general. There is a global financial crisis, but it is not announced. What is happening is the depletion of the financial stock of companies. A company like Apple has billions in cash, and this is what makes investors not worry because Apple did not fall below 500%. For example, before 2008, we were making 200% profits in real estate investment. This is approximately in most countries with a free economy. In 2010, profits fell to 100%. For example, if the cost of building a house is one million, it is sold for two million. Apple costs $300 for an iPhone, for example, and sells it for $1,000. Here, the problem began with the rise in the prices of raw materials, with America moving towards the black hole policy that sucks everything in. Here, companies and countries are trying to use the financial stock from the profits that were collected from 2001 to 2013. This financial cycle occurs approximately every 50 years. Why does this depend on the rise or fall in the level of natural resources in the land? Now, for example, what I used to buy for a thousand dirhams 7 years ago, I buy now for approximately 2,700 dirhams. Why? Because the movement in the dollar has decreased threefold. The balance is made to keep the markets stable through the companies’ reserve money. I see that we are in 2013/2014 in terms of production activity and profits, but there is strong pressure on companies to continue pumping money until the market is absorbed for the next few years. In general, since the Samsung Note 7 crisis, I have not heard anything about the news of the South Korean government investment agency that disappears under the name Samsung because there is no company in the world that controls the economy of a country by 40%. We are waiting to see if Apple will launch a larger iPhone X plus or not.

comments user
ahmed sameh

We hope, Adam, that you will write to Apple and you have a good reputation with them by following your website
You care about Apple, the XNUMX-inch MacBook is so versatile that it has many uses, from Sawyer graphics to administrative work and a call chip to make calls from the Mac.
Also, the iPad will be a strong competitor to the Surface Book XNUMX, with the capabilities of GeForce and RAM that reach up to XNUMX GB and the battery that reaches up to XNUMX hours connected
With these aspirations, Apple dominated many markets without a competitor
Thank you very much in advance
Addicted

comments user
Lebanon

I believe that everything has a life, an end, and a luster, then frightened, then extinguished, and Nokia is not far away, and these days are circulating among people and I am one of the people who I used to change every year to the latest version of the iPhone, and now I made a firm decision that I want God on iPhone 7 and I do not want to update because I do not need to I am satisfied with the iPhone 7, and I do not want to waste my money and waste something that is not necessary.

    comments user
    Happy

    Comparing Apple with Nokia, an unfair comparison

    comments user
    Last⚜️Hero • 

    Everyone wants the latest and the iPhone X is very different (do not laugh at yourself) if in cash you would have bought the latest 😉😂 secondly.
    You say everything has an end? True, but for everything, I mean everything: Apple, Samsung, Sony, etc.
    Near Future Company (Abboudi & Sisters) 📱🤪

    comments user
    BOSS

    Are right

comments user
Apple lover

God willing, we will see new designs in 2019 because Johnny Eve has returned to the company

comments user
Ali Hussein Salem Saleh Al-Mirfadi

You say yesterday, “Don't you?” On Thursday, the Telegram app was removed from the App Store. Unfortunately, I searched for it and found it.

comments user
Shady Mustafa

This is the case of the stock market, and nothing new to it. With every sharp rise, a decrease occurs after it, due to saturation, and as soon as it starts to rise again, there is no rise after a rise.

comments user
And 1 limit of all people

May the peace, mercy, and blessings of God be upon you. It's been a long time since I saw you.

comments user
Zeyad

I hated Apple after the battery downgrade issue and I'm entering the Android world

comments user
Ahmed

Apple is very strong and bears all the reasons for strength, and it is almost like Apple Bankia, it is wrong because the basis of the fall of Nokia that I expected years before it fell is the bad operating system that Nokia has been related to and around it uses the Windows system and the Android system, and when the iPhone appeared, the reason for its strength was the stable operating system And the beautiful…. Apple is a strong company and its foundation is strong par excellence. It has the most powerful operating systems for devices and has various devices interconnected with each other and has succeeded in connecting the owner of the iPhone with it. The watch and the wireless speaker only work on iPhone.
The fall of Apple is very far away now, unless other reasons emerge, as the future is unknown.
Samsung is the strongest competitor, but there is a risk to its position, as Huawei is coming ...
If Samsung is unable to create an operating system for it, it is about to fall, and this is possible

    comments user
    Youssef Al-Fahd

    Well done

    comments user
    Khaled

    Before we rush to judgment and say Apple will collapse and others. Consider companies like Mercedes, BMW and others that have not collapsed for over a hundred years and have gone through wars and economic collapses. If Apple is like these companies, it started strong from day one and collapsed once, but it has stood up stronger than before. For many reasons, including first the operating system and second and most importantly customer service. For example, I had a Samsung phone two years ago and a problem occurred with the phone and I sent an email two years ago and I am still waiting for an answer, hahaha. This will be the collapse of such companies. Android is a trivial company and anyone who buys from them will regret it.

    comments user
    Majid Al-Brahim

    My brother Ahmed, this strong system, which is Apple's strength point, in which problems and scandals arose and in a strong and noticeable decline. I do not think that the strength of the system is sufficient for the continuation of the company's success if it is not accompanied by the development and creativity of the devices. This is sufficient reason to pull the rug out from under Apple and gradually switch users to Android if Apple does not wake up and improve its system and hardware.

comments user
Bin Rajab

Apple's future is Nokia's past.

    comments user
    ahmad

    The future of Apple cannot be like Nokia because Apple has a strong and smooth system that the company originally relied on mainly in marketing and not the features of the phone (hardware) so it differs from Nokia

comments user
Mr. Awaited

Brothers, frankly, Tim Cook, Mo, like Steve Jobs, because Steve Jobs was a genius in the sense of the word. Thank you Yvonne Islam.

comments user
Peace be upon you

The price of the iPhone X is $1200. It broke Apple's back before the customer, and despite the astronomical price, things did not go as they had dreamed.

comments user
$ Kenan $ 💥

What interests me is how Samsung clings to the lead for so long and how Chinese companies made their way to exit HTC, Blackberry, Sony, LG and other major players from the list .. I see that these Chinese companies no longer care about TAVs only in China, but in the global market .. I previously learned that Xiaomi is preparing to enter the US market, I don’t know if the matter happened or not .. But if the matter is done, it will be a risk to Huawei, so I am thinking of buying shares in one of these Chinese companies!

comments user
Majid Al-Brahim

Nice article, useful information and logical neutral language Thank you 🌹

comments user
Light • O God, forgive my parents and siblings

Tim Cook has seen the feast with distinction
From losing credibility to destroying devices, for example the battery for the Taban system, to issue iPhones annually that differ from each other.
Nevertheless, I think that this is the beginning of the end for Apple, it will improve if it changes the policy it is walking on .. and if Tim Cook flies it will be better .. I feel it tends to preserve the existing with few improvements, as for the previous stakes, innovation, revolutionary new and change every period and period like Steve Unfortunately, Jobs is not printed

    comments user
    Majid Al-Brahim

    Sahih Noor, I completely agree with you .. Tim Cook brought the holiday and the world’s special .. Even the iPhone 6 was designed from Jobs’s time and Tim Cook came and issued it and it has lasted for four years until now as a precedent for the iPhone’s history due to the lack of creativity and development that you mentioned 👍

    comments user
    Mohammed Shalaby

    Stay on your crazy, you will not come from the insane 😂

    comments user
    Light • O God, forgive my parents and siblings

    Hahahahahahahahahahahahahahahahahahahahahahahahahahaha this is more an example any one patient is thirsty from Apple, we tolerate Apple or no other honestly

    comments user
    Light • O God, forgive my parents and siblings

    True brother Majid 👍🏻
    Once again, I started hearing news that Apple started developing the production and manufacture of a new iPhone as we used to annually ... Imagine if the new iPhone is going on the same monotony as it happened with those four years ago !! Here, the grandfather of Apple will be generous for itself .. I do not rule out how to dispose of it

comments user
Amr Yousry

It is natural that the worst year for Apple in terms of system and devices also occurs in which this stock crash occurs, but it is not a big drop, as the company is still making billions and more than before, but I do not think that the company should return its accounts because it is far too selfish and conceited and all it will do is that The price of its products decreases a little, and soon its share returns to the above and more, and we are the ones who pay the price for all of this

comments user
Mohamed Elbiali

There is no creativity at present in Apple

comments user
Ahmed

The reason for the collapse Despite these high and imaginative sales in the Book of God (God curbs usury and raises alms) there is no blessing in usury and the abundance of evil does not deceive you.

comments user
Khaldoun

Yes gentlemen ... it is the beginning of the end for Apple
Because nothing revolutionary was presented, the slow development and the absence of creativity,
It follows in the footsteps of Nokia and BlackBerry to the abyss ... with great regret.

    comments user
    Majid Al-Brahim

    It is true that I agree with you in general, although I do not think that it will reach the stage of Nokia 👍

comments user
N Alrkabi

The greatest measure of success for every business is honesty, and I think Apple took a chance on that. Here's the regression point

comments user
Muhammad Abu Shihab

Far from reality, the Apple stock crash is part of the US stock crashes that have occurred over the past two days
-
Google’s stock also collapsed, as did Exxon Mobil, Microsoft and Facebook
-
As for the reason for the collapse, it is that the current value of shares is more than the actual value they are entitled to, and it is unlikely that a global financial crisis will occur this year, such as the one that occurred in XNUMX.

    comments user
    BnSamy

    Google, Apple, Microsoft and Amazon announced their results; the first three had disappointing results and their shares fell, and the fourth, Amazon, had great results and its share rose on the same day that the shares of the others fell.

    comments user
    Muhammad Abu Shihab

    Thank you Bin Sami for clarifying your point of view

comments user
Ahmed

I do not think there is a great danger in the bright future of Apple during the next ten years, and the company must increase the sale of devices, especially the iPad, iPod and the mighty Mac devices.

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