Apple reports record quarter, stocks plummet

Sales of Macs down 18 per cent, iPad sales up nearly 50 per cent, iPhone sales up 30 per cent.

Apple's released its quarterly earnings yesterday, and they weren't great. Although, in Apple's case, "not great" still means that revenue grew 18 per cent year on year to $54.5bn, profits hovered at $13.1bn, and its financial year 2012 is the largest corporate earnings year in history. Twitter loves to talk about first-world problems — this is "biggest-company problems" of the highest order.

Sales of Macs were down 18 per cent, but iPad sales had grown by nearly 50 per cent, and iPhone sales by almost 30 per cent. The iPhone 5 was the best-selling smartphone worldwide, and the astronomical mark-up on it — it generates a 55 per cent profit margin for the company — means that it will be jealously guarding that market for some time.

Still, the narrative is that Apple's had a bad quarter (because they really ought to own a small country by now, and their failure not to do so is frankly embarrassing), and so in after-hours trading, stocks were down 10 per cent.

The diagnosis seems to be that a hefty chunk of the decoupling of revenue and growth was down to the much-reduced profit margins of the iPad Mini. Apple's profit from sales of the 7 inch iPad is much lower than it gets from sales of the full-size one (although that hasn't stopped people arguing that it's making a mistake to charge so much for it, or not to put a vastly expensive retina display on it), so to the extent that its growth is because of entering that new market, its profit share will fall.

Worse for the company is that there is some evidence the mini is cannibalising sales of the full-size iPad. Certainly, respected bloggers like Marco Arment and John Gruber report preferring their minis to their old iPads, and they would seem to be the target market for the full-power device.

But if its problems stem from a growing presence in low-margin markets, then it's rather odd that the proposed solutions are… growing their presence in low-margin markets. Apple regularly comes under pressure for their low and declining share of the smartphone market — currently at around 20 per cent — with the implication that its strategy of chasing profit over raw sales is wrong. Reports that the company is attempting to build a low-price iPhone which would debut in late 2013 suggest that the company is taking the recommendation to heart.

But it seems that if it does bring out a successful low-margin entry level device, it will be slammed for declining profit; if it doesn't, it will be slammed for declining market share. Meanwhile, whatever the company does, it will be raking money in hand-over-fist. Maybe the problem lies with the people doing the slamming?

Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Watch: The evidence Nigel Farage said money sent to the EU should go to the NHS

After the EU referendum result, Nigel Farage said it was a "mistake" for Leave to suggest funds could go to the NHS. But what's this?

Remember Friday? (I know: it's not necessarily a pleasant thing to do, but bear with me.) On Friday, hours after the result of the EU referendum was announced, Nigel Farage appeared on Good Morning Britain and said that the Leave campaign advertising which linked the extra "£350m a week" Brexit would allegedly gift us with the NHS was a "mistake".

Sure, it was on posters, and emblazoned on a bus, and he didn't speak up to disabuse anyone of the notion. But let's give Farage the benefit of the doubt and pretend he does sorely regret the fact that, through no fault of his own, members of the electorate may have been led to believe that that money would be put into healthcare. It must be tough, when you ought to be high on your victory, to have to answer for other people's mistakes

Ah. Hold that thought.

It looks like the Independent has unearthed a video of Nigel Farage on television before the vote, and  strange thing  he tells Hilary Benn that the money currently being sent to Europe should be spent on, er, "schools, hospitals and the NHS".

Well, this mole isn't sure what to say. Maybe Farage doesn't remember this specific moment? Maybe when he said "schools, hospitals and the NHS" he actually meant something different, like "negotiating our exit from the EU", or "paying to access the common market despite no longer being a member"? Or maybe when he said that money should be spent on these things, he didn't mean it necessarily would be, and it would have been entirely unreasonable for the voting public to make such an absurd leap?

All I can suggest is that you watch and decide for yourself, dear reader.

I'm a mole, innit.