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Apple Q2 Numbers


KFRCanuk
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Here is a great writeup of apple's q2 numbers by none other than Jean-Louis Gasse

 

http://www.mondaynote.com/2011/04/24/inside-apple%E2%80%99s-q2-numbers

 

"These last figures are striking. How did Apple squeeze R&D down to 2% of revenue when Microsoft is closer to 15%? Part of the answer is having a large denominator: lots of revenue. Another part is that they have fewer products than any other comparable company. Still, 2% is an astonishingly low number and, curiously, one that is rarely remarked upon on Wall Street — or anywhere else — when discussing competition between high-tech companies.

The same applies to the SG&A (Sales, General and Administrative) expense number: only 7%. I don’t know of a tighter and, as the same time, more prosperous ship.

 

(Those percentages get even lower if, as some analysts do, you exclude Stock-Based Compensation. Look inside the 10-Q for more details.)"

 

It's pretty incredible how well run apple is compared to other companies.

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I noticed this very low R&D amount when I looked at their latest quarter. At 2.4% of sales this is definitely low. For comparison, RIMM is at 6.8%. Quite amazing to see what they are achieving with so little.

 

At the same time, it shows how little it would take to find the next big idea or the guy in his garage thing. It is a good thing to see them not blowing away big dollars on unproductive R&D, but I am wondering how long they will be able to deliver as such.

 

Cardboard

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I noticed this very low R&D amount when I looked at their latest quarter. At 2.4% of sales this is definitely low. For comparison, RIMM is at 6.8%. Quite amazing to see what they are achieving with so little.

 

At the same time, it shows how little it would take to find the next big idea or the guy in his garage thing. It is a good thing to see them not blowing away big dollars on unproductive R&D, but I am wondering how long they will be able to deliver as such.

 

Cardboard

 

As total number spent on R&D, Apple spends much more, as they have over 4x the revenue of RIMM. With revenue approaching 90 Billion, Apple is spending well over 2 BILLION a year on R&D!

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As total number spent on R&D, Apple spends much more, as they have over 4x the revenue of RIMM. With revenue approaching 90 Billion, Apple is spending well over 2 BILLION a year on R&D!

 

Right, this is a huge point.  MSFT is a bit different in that they've been investing desperately trying to throw stuff at the wall to see if it sticks.  Apple has a pretty disciplined approach, but they still have a huge amount of money to work with so the absolute numbers are still quite large. Done properly, there's a huge scale advantage.  If you can get your organizational culture to work right...there are huge advantages to being big.

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As total number spent on R&D, Apple spends much more, as they have over 4x the revenue of RIMM. With revenue approaching 90 Billion, Apple is spending well over 2 BILLION a year on R&D!

 

It's not the amount they spend on R&D that's so important. It's the return on that investment. And that continues to be huge for Apple.

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As total number spent on R&D, Apple spends much more, as they have over 4x the revenue of RIMM. With revenue approaching 90 Billion, Apple is spending well over 2 BILLION a year on R&D!

 

It's not the amount they spend on R&D that's so important. It's the return on that investment. And that continues to be huge for Apple.

 

Oh no doubt... just compare the return on invested capital of AAPL to that of MSFT, or even to a pharmacuetical (a lot of them spend well over 10% of revenue on R&D!) last year, MRK spent nearly a quarter!

 

Phil Fisher talks a lot about R&D spending; I should prolly go brush up on that, as it's been a few years and is getting kinda fuzzy!

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