Apple's Financial Position For A Stable Business For The Past 10 Years

Financial Statements analyzed for this assignment includes Unaudited Consolidated Condensed Balance Sheet, Statement of Cash Flow and Income Statement that are downloaded from http://investor.apple.com/financials.cfm. (APPENDIX II)

Apple Inc. is part of the electronic equipment industry that designs, manufactures, and markets mobile communications. Apple also creates and sells media devices, personal computers, and portable digital music players worldwide. This company was founded in 1977 and serves various customers. Apple’s top three competitors are Blackberry Limited, Google Inc., and Hewlett-Packard Company (Yahoo Finance, 2014). The purpose of this paper is to discuss the financial health of Apple by using horizontal analysis, vertical analysis, ratio analysis, and Altman’s z-score for the year 2011, 2012, 2013.

Even the greatest companies in the world have a weakness, and Apple Inc. is no different. The few weaknesses of Apple Inc. include higher prices than competitors, matching consumer expectations, overdependency on a few products, and incompatibility with third-party products and software (Bhasin, 2018; Dudovskiy, 2018). In 2017, the average price of a cell phone was $400. The cost of a new iPhone in 2017 was about $749 (Dudovskiy, 2018). However, Apple Inc. claims the value and superior craftmanship justifies the higher price tag. As mentioned earlier, Apple Inc. has produced unapparelled products year after. The downside to this is that consumers now have great expectations of Apple Inc (Bhasin, 2018). Consumers want the continued high level of innovativeness year after year which is difficult for any company to provide. The product line-up of Apple Inc. includes seven to eight main categories of products. A fail in any category results in a huge hit to Apple Inc. Apple Inc. products are mostly only compatible with other Apple products. This is really a double edge sword for Apple Inc. On one side, it forces consumers to purchase other Apple products on the other side some consumers refuse to own any Apple products and Apple Inc. loses out on many possible relationships with third-party products and

One key element of Apple’s strategy in computers, personal media players, tablet computers, and smart phones is product innovation, diversification and development. Over the years Apple has been very successful in integrating software and hardware in new developing products. Despite the struggling economy in recent years, Apple has been able to grow their market share and stay ahead of the game.

Apple has a strong financial foundation which allows company growth and allows them to maintain the competitive edge.

Apple has been in presence for under 40 years, yet it is the world's most important organization and brand, with a business capitalization north of $700 billion and over $160 billon in the bank. Past its financial strengths and business sector predominance, Apple's interior culture and its way to deal with its business have turned into the gold standard for various commercial ventures.

General perceptions of Apple as a cashed up, financially dominant company are not without basis. With $194bn in cash and marketable securities, Apple executives would need to consider if they really need the money and what use would an extra 1.25bn in Swiss Francs be to them. However, they need not look further than Apple’s “Capital Return Plan”, where Apple have “executed (their) capital return program aggressively, and (they’ve) now taken action on over $112 billion of our $130 billion program.”(Luca Maestri, Apple SVC & CFO, Transcripts,

Apple has prospered internally and it is necessary to consider both strengths and weaknesses. Apple has lots of strengths, the major of them being it’s impressive brand reputation, Apple managed to position the brand as “premium products” for “elite” people. Customers are loyal and tend to stay in Apple’s ecosystem. Apple’s self-reinforcing ecosystem, it has a diverse ecosystem which integrates various hardware and software products into one large interactive space. Status of top innovator, Apple is perceived as the leading innovator and its products are highly anticipated. Apple’s very strong financial performance, high profit margins and very high liquidity. It’s network of retail stores, high-quality customer service helps to create advanced user experience. A powerful marketing strategy, Apple’s team masterly uses various marketing techniques to create a hype for their products and to strengthen the brand.

“Apple was two months from bankruptcy” in September 1997 which led to CEO Steve Jobs to reconstruct their plan. In order to bring Apple back up into the competitive market, Jobs implement a new strategy which “shrunk Apple to a scale and scope suitable to the reality of its being a niche produce in the highly competitive personal computer business. He cut Apple back to a core that could survive” (12). What made Job successful was focusing on the sources and barriers to be successful in the market and to utilize the opportunities that came by. The strategy of eliminating unnecessary cost or reducing risk help transform Apple’s business

Due to the premium pricing strategy that the company has chosen, recessions, and inflation will have a negative impact on Apple’s revenues. Also because of the fact that the company has a huge amount of cash assets the company is affected by the increasing inflation rate in the United States. Moreover, because the company operates on a global scale, the fluctuation in foreign exchange rate will have a direct effect on the business. Changes in prices of materials and resources, human power and taxation rates are economic factors that could affect the business. Legal issues with economic impact can lead to revenue loss and decrease market shares of the company. However with stable economies in USA and other developed countries, the company is

Our group decided to analyse the company Apple Inc., listed on Nasdaq Market as AAPL. The analysis was mainly based on the annual financial report of the company for the fiscal year ended on September 29th 2007. Apple Inc. is today one of the most

We chose to research Apple Incorporated, one of the most innovative companies of our generation. It is safe to say that nearly every one in the US and many foreign countries have used or at least heard of Apple products. We will be looking at the macroeconomic variables that impact Apple’s business as well as how the current developments in the industry have impacted Apple’s financials and we will also look at how Apple competes with other firms in the same industry.

sales for the past few years. Furthermore the financial analysis showed that a big part of the net sales is generated by complementary products which can be connected to the sales of Macs, iPhones and iPods.

Apple, Inc. (formerly known as Apple Computer, Inc.) was incorporated in the State of California in 1977. Apple currently designs, manufactures, and markets a variety of computer and personal electronic products, including Macintosh computers, and the iPod digital music player. AppleÕs key markets are consumers, creative professionals, educational institutions, and business users.

Apple had nearly $137 billion of cash at the end of Dec 2012. Over the past few years, the Company had been highly successful with the launch of the iPhone 3G in 2008, and which was followed by the launch of iPad in 2010. The Company enjoyed high profitability, and was able to keep its costs at a minimum. The gross margin on the iPhone was between 49% and 58% from October 2010 to March 2012, and the gross margin on the iPad was between 23% and 32% in the same time period. Apple’s capital structure included no debt; hence, there was no outflow of cash for making interest payments.