Links:
http://www.financialpost.com/related/topics/Apple+without+Jobs/4123266/story.html
http://www.financialpost.com/related/topics/Jobs+health+overshadows+Apple+earnings+today/4124760/story.html
http://www.financialpost.com/news/technology/Apples+earnings+outshine+Jobs+absence/4128629/story.html
Apple's Financial Statement:
http://www.apple.com/investor/
Summary:
On January 17th, Apple's Chief Executive's leave of absence was made known to the world. Steve Job requested to take time off of his work due to medical health concerns, and in that, another concern has risen. Steve Job is [to some people] Apple itself. He does more than his part for this popular company and often takes part in all aspects of creation in its products. Because of this, will the shares for Apple drop like it did the last time he took a leave of absence? Worse yet, Job has not provided any information or date on his return to the beloved company. All of that may have a huge effect on Apple's future, but so far, they have been doing extremely well. Mr.Cook, who will be stepping in for Job, has proved to be a reliable pair of hands for all the other times Job has taken a leave of absence. For the company itself, Apple has done gloriously with reaping in the money and shareholders should be pleased. Apple brought in an astounding sum of US$26.74-billion in the quarterly ending of Dec.25, 2010 which is a jump of 71% from exactly a year ago of US$15.68-billion. It sold 16.24 million iPhones despite being in short supply as well as 4.13 million Macs because of a high demand for Apple's lovely thin Macbook Air computers. iPod Touch has also accounted for more than 50% of the all the iPod sales. Apple's success in the technology-filled world has been noted globally with the iPhone, Mac computers, and having created the tablet computing market itself with the introduction of the iPad. Hopefully the jump of 4% in shares bought after Apple announced it's earnings will continue to increase rather than decrease with the absence of Steve Job.
Connection:
The first connection I made from Chapter 3 to this article is the earnings per share. The earnings per share is the amount of income earned in relation to the number of common shares held by the owners. To calculate the earnings per share, divide the income by the number of common shares outstanding, in a period. An example can be found in Apple's financial statement for the three months ended of December 25, 2010. Their net income of $6,004 (in millions) was divided by their weighted-average shares outstanding of 919,294 (in mils) producing the basic earnings per share of $6,531.
The second connection regards the gross margin which is "sales or service revenues" subtracted by the "cost of goods or services sold". In Apple's financial statement for the three months ended of December 25, 2010, their accounts are name differently, "net sales" and "cost of sales", but still produces a gross margin. Apple has $26,741 (in mils) from net sales, $16,433 (in mils) from cost of sales, and a gross margin of $10,298 (in mils) for the three months ended of December 25, 2010.
Reflection:
Looking from the consumer's point of view, I would not let the absence of Steve Job defer me from buying Apple's latest products until his (unknown) return, for a safer or better products guarantee. As a shareholder investor, I would also not let Job's leave keep me from buying stocks in Apple. My reasons for this is because it has not been the first that that Job has taken long periods of time off work. The company still fared well during those times despite some drops in stocks. On top of that, Apple has been showing very satisfying results since the release of it's popular iPad. The iPad is not only new to North America, but to the whole world. I am sure that there will be plenty more versions in the future, each better than the previous. Therefore, the iPad itself will be in popular demand for a long while, guaranteeing the future for a steady net income. If investors share the same thoughts, then hopefully stock prices will also continue to be steady in the near-future.
