If anyone of you have heard recently that Apple’s profits have fallen for the first time since 2003 but the amazing thing is that their cash has risen to a mind blowing $145 billion. Many of the analysts thought that Apple will not be able to sustain the profits which they had enjoyed under Steve Jobs but Apple to everyone surprise openly displayed their profits fall for the first time in a decade. Even with this news one thinks that the company has done badly but that is not the case. Apple declared a total of $9.5 billion in the second quarter and amazingly had a major boost to its share market, a program they buyback the shares to $50 billion.
If we compare Apple with the previous years second quarter, Apple generated revenue of $39.2 billion with a net profit of $11.6 billion but this year Apple managed to get revenue of $43.6 billion with net profits up to $9.5 billion. This has made a lot of analyst chew on their expert forecasting. Apple is focusing on buying back the shares and has a total of $100 billion in the time span of two years. Apple has successfully added $8 bullion to its cash and has taken the total cash to $145 billion which is amazing in all standards. This has all been possible due to the large amount of selling of IPad around the world. It is common knowledge that shareholders were worried about Apple’s profits before the quarter and the biggest challenge now for Apple would be to come up with new innovative products which they have made a reputation for.
Apple has been facing a massive problem in the smart phone industry which is not a hidden fact anymore. There main goal is to boost the sales of IPad that will get Apple out of this ditch that they are in. They are more focused on IPad which has seen massive sales all over the world and have given boost to Apple in the recent years. There main goal is to get a massive chunk of PC’s market which IPad has taken away. They will be focusing on getting a major market share and replace PC’s share as many people are moving to IPad. At this stage Apple is enjoying no competition in the market when it comes to sales and profits. Just to give you a comparison of Apple’s competition Google’s Nexus 7 tablet recorded sales of about 5 million tablets in six months and in comparison Apple had sold 10 million IPad minis in only two months time. In my view Apple has been its own demon, why you might ask. Apple has been so focused on keeping its profit margins high and keeping the prices high that they had completely failed to capitalize on the issues that faced BlackBerry. Apple could have taken massive lead against BlackBerry if they had focused on this side rather then building up a profit margin.
Last but not the least I must say that we have a clear example of the market share’s slipping away from Apple. An example is that in 2010 all the smart phones that were powered by Android operating system were no where to be found in the market i.e. their shares in the corporate sector were virtually zero but now in recent times especially in 2012 they had secured about 34% of businesses in the corporate sector. In comparison if you look at IPhones usage rate Android has surpassed it in business six times. We can only wait and see what new strategy Apple will bring.