How is Apple doing? Based upon all the noise and the line of Apple surrogates out Mansplaining the MacBook Pro mess, you’d think the company was circling the digital toilet. Without question, 2016 hasn’t been a great year for Apple by any measure. With one exception, almost everything is heading south for the winter. Revenue, profits, and unit sales are going down for every major product. You know things are not looking up when the company’s 4th quarter financials headline is this:
Services Revenue Grows 24% to All-Time Quarterly Record of $6.3 Billion
No, Apple isn’t becoming a services company. Apple is a hardware company and hardware sales are not doing so well these days. Except at Lenovo. Who? Lenovo. You know, the world’s largest PC manufacturer. Nope. It ain’t Dell or HP. Not Asus, Acer, Dasher, Donner, nor Blitzen. It’s Lenovo, and that’s where things are looking up.
Like Apple, little Lenovo makes all kinds of hardware, and last quarter brought in $11.2-billion in revenue; like Apple, it was a decrease from the year before, and like Apple, Lenovo was profitable last quarter.
Lenovo made $157-million in profits while Apple posted $46.9-billion in revenue and made only $9-billion in profits.
The company didn’t quite make in profits what Lenovo did in total revenue. How sad. Now, compare that to Google which doesn’t make much money on hardware. The search engine giant made more than $22-billion in mostly advertising revenue, and profits of about $5-billion. That’s comparable to Windows and Office maker Microsoft which also makes personal computers these days. Microsoft’s revenue for the past quarter was just over $20-billion, and profits came in at just over $4.6-billion.
My math tells me Apple made about the same as Google, Microsoft, Lenovo, and Amazon put together, but on far less revenue.
Amazon is the world’s largest online retailer and an Apple competitor here and there, but not among profitable companies. Revenue in the recent quarter was more than $32-billion, but profits weighed in (I’m being kind by using the word ‘weighed‘ as if Amazon’s profits were heavy) at a mere $252-million.
Put another way, Apple makes that much profit in three days.
Let’s take that comparison in another direction that is somewhat difficult to compare this year. Apple’s most feared competitor is Samsung. Yes, that Samsung. The same Korean conglomerate that makes washers and dryers, batteries, chips of all kinds, and smartphones. Last quarter, Samsung had a fire sale on smartphones, so the company won’t play in the financial comparison games this year.
Yes, we want Apple to do better. After all the company has investor mouths to feed, employees to incentivize with paper stock certificates and stock to buy back. Oh, and there’s that need to introduce a new product every now and again, and even refresh some old ones (Mac Pro, iMac, Mac mini, I’m looking at you!), but compared to the rest of the apples in the technology orchard, Apple ain’t doing all that bad.