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Apple reports Q2 results ($11.6 billion profit/$39.2 billion revenue)

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jmdajr

Member
Nah man. That extra 6" of screen real estate matters.

I guess. But in that case I just use my PC with a 23inch monitor. I even have it hooked up to my HDTV. I know there is a future with Ipad Tv connectivity...but not there yet (in my opinion). Overall I have stuff that still works(laptops/computers), but when things start breaking I'll have to decide what ecosystem I want to use. I'm only partly in because a phone is pretty much a necessity nowadays and by chance I have a smart phone (android). But other than that I don't know how long it would take me to jump in. I like keeping my gadgets until they break. And I'm pretty sure I will always have a tower computer..even if one day it's just acts like my server.
 

RevoDS

Junior Member
Fun fact from Daring Fireball:



Damn that's insane. Their record smashing holiday quarter a couple years ago constitues ~10% of what they're earning now in non-holiday quarters.

Small correction, it was a record smashing quarter but it wasn't a holiday quarter. Apple's fiscal calendar ends in September, so Q4 2009 would be the June-September quarter. You're thinking of Q1 2010, which is the quarter that spans October-December.

It's not any less impressive though.
 

numble

Member
This is a common misdirection. In reality, labor - even potential American labor - is a small part of the iPad's total cost. There's no doubt Apple would make a smaller profit on the iPad, but it is well documented that Apple's profit margins are huge. I haven't seen any estimates that show the manufacturing cost of an American made iPad to be higher than the retail price of the current iPad. If you have an actual estimate that contradicts this, I'd be interested in seeing it. It's my understanding that Apple switched to Chinese manufacturing, something Jobs was reluctant to do, because Chinese factories were more capable of keeping up with demand.
Most estimates of the cost of an American-made iPad are only calculating the cost of final assembly currently done by Foxconn. A more accurate assessment would start with including things like the cost of starting the mining of rare earth minerals in the US (a market almost exclusively owned by China and which places very expensive quotas on exporting the stuff if you're not manufactured in-country), and the cost of manufacturing all the many other components that go into an iPad, such as the glass, the screen, the battery, the WiFi chips, the speaker, etc. Simply manufacturing all those items in China and shipping them to the US would still not get you to a true American-made product, except allowing you to say so on the label. It's not simply moving the Foxconn factories, but the factories for all the other components, including the mines for the raw materials to the US.

And of course, you can meet demand with American labor, costs would just have to go up. Foxconn seems to open 2 factories per year recently in China, to keep up with iPhone and iPad demand that doubles every year. There's cheap Chinese infrastructure that let's you get things from a mine in a remote province to the factory quickly.

There also is no good way to deal with the cyclical nature of Apple manufacturing. For the initial ramp-up for launch, tons of workers are needed and tons of overtime paid. Much fewer are needed later on as the line becomes both more efficient and demand goes down, and Foxconn shifts those workers to making Kindles or Xboxes. For the new iPad launch, 3 factories were operating at peak production focusing on the new iPad for the 2 months prior to launch, in at least one of those factories, they've already shifted most iPad lines to working on other products now, with workers claiming they're now able to produce as much product with fewer hours and workers (probably a component of how margins continue to increase, despite wages rising 15%+ every year). For America, I don't think you can have manufacturing for other companies to shift workers to, nor be able to have enough workers to do this seasonally without paying a premium both for seasonal labor and to have a factory sit half-idle after the peak season.
 
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