Question
5. What is your assessment of Apple Computer’s financial performance the past three years? (Use the financial ratios in Table 4.1 on pages 94-96 of the text as a guide in doing your financial analysis.)
6. What recommendations would you make to allow Apple to strengthen its position in its most important markets? What steps should it take to ensure that the iPad becomes a success in the marketplace and a major contributor to the company’s overall performance?
please I want the answer to questions 5 and 6
588 Section 5 Strategic Markering Case EXHIBIT 1 Summary of Apple, Inc.'s Financial Performance, 2005-2009(mllions, except share amounts) Income Statement Data 2009 2007 2005 Net Sales Domestic 19,870 18,469 14,128 11,486 8,334 16,667 36,537 14,010 32,479 9,878 Total net sales Costs and Expenses 5,597 13,931 24,006 15,852 2,963 Cost of sales 23,397 1,333 4,149 13,717 9,889 Research and development (R&D;) Selling, general and administrative (SG&A;) Total operating expenses 3,761 4,870 6,275 2,433 income 4,4092,453 365 2,818 829 7,658 643 Other Income and expense Income before provision for income taxes Provision for income taxes Net income Earnings per common share diluted Shares used in computing earnings per 620 6,895 2,061 7,984 5,008 1,808 480 $ 5,704 $ 4,834 3,496 1,989 $ 1,328 56.29 $5.36 $3.93 $2.27 share- diluted (in thousands) Balance Sheet Data (as of September 30) 907,005 902,139 889,292 877,526 856,878 Cash, cash equivalents, and short-term investments Accounts receivable, net 23,464 3,361 455 2,954 53,851 19,284 6,737 24,490 15,386 1,637 10,110 8,261 Property, plant, and equipment, net Total assets Current liabilities Noncurrent liabilities Shareholders' equity 2,422 509 2,455 39,572 14,092 1,252 1,281 6,443 25,347 7,205 11,516 3,487 9,299 1,516 27,832 21,030 14,532 9,984 7,428 Source: Apple Ina., 2007 and 2000 10-K reports Both businesses and consumers were tending to replace desktop PCs with portable PCs such as laptops and netbooks. Total shipments of portable PCs grew by 18.4 percent in 2009, with consumer purchases of portable PCs growing by 38 percent during the year Low-end laptops and netbooks accounted for the majority of consumer portable PC sales in 2009. The sale of desktop computers was expected to decline in markets of all countries except emerging markets in Asia, which would allow portable PCs to make up 70 percent of industry shipments by 2012 APPLE'S COMPETITIVE POSITION IN THE PERSONAL COMPUTER INDUSTRY Even though a larger percentage of Apple's revenues were increasingly coming from non- computer products, the company still saw computers as its core business. Apple's propri- etary operating system and strong graphics-handling capabilities differentiated Macs from PCs, but many consumers and business users who owned PCs were hesitant to pur chase a Mac because of Apple's premium pricing and because of the learning curve in- volved with mastering its proprietary operating system. The company's market share in the United States had improved from 4 percent in 2005 to 8 percent in 2009 primarily be cause of the success of the iPod and iPhone. These products created a halo effect whereby
Explanation / Answer
5. Apple is an organization which holds a dominant position in the market. It act as the market leader. The financial performance of the Apple computer is taken into consideration and an analysis of the past three years performance is discussed here.
Through analyzing the financial performance of the organization Apple from the year 2006 to 2009, it can be considered that there is a steady increase from 20% to 40%. The case also evidences that there is a considerable positive change in the revenue generation of the company in the past three years from 10 to 17 billion. This highlights that the competitive advantage of the organization is growing continuously in the global market.
The case also reveals that the debits and liabilities of the organization is decreasing and increase in the assets in the past three years. It can also be concluded that the organization effectively balances its liabilities and the investment of the stakeholders.
