The Point

Andreas Scherer on Business and Science

Apple’s Q2 Results

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Most companies would be delighted to present results similar to those of Apple. The company announced a $10.33B profit which turns out to be the 23rd highest quarterly profit posted by any company. But then there are three major issues with the Q2 results that we should not take lightly. First, the company “only” sold 51.19 million iPhones during the quarter compared to 61.17 million in the same quarter one year ago. Second, for the first time in 13 years Apple is not able grow its top-line. So, revenues are down. The company reported $50.6 billion in Q2 which is less then the $58 billion reported in the same period last year. Third, profits are down year over year as well. 

So, the question arises, is Apple still a growth story? Was this just a blip or is this a beginning of a new trend? A maturing iPhone market, increased competition in the PC market, questions about its ability to further penetrate the Chinese market and general concerns about the macro-economic climate are surfacing. In addition, there is this perception of Tim Cook being a masterful operator but not that visionary product whiz like Steve Jobs. The recently increased focus on paying out dividends and increasing the stock by back program don’t help. These are typically moves by maturing companies to prep up the stock.

In the end, these are no real problems for Apple. The next quarter can answer most of these questions, if Apple is able to get the iPhone sales numbers back on track. 

Please find my quote in Ecommerce Times here.

GoPro integrates with Twitter’s Periscope

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On Monday, GoPro announced an integration with Twitter’s Periscope app that allows live streaming from a GoPro Hero4 camera. Periscope users can switch between broadcasting from their iPhone’s camera to their GoPro directly from the phone screen with the touch of a button, GoPro said. The feature allows GoPro shooters to use the Periscope interface like a production switchboard. They can toggle between their iPhone and GoPro cameras on the fly, adding variety to video of a live event.

Here is what I told TechNewsWorld, “There are monetization options available, but only if this app really takes off. For example, celebrity athletes who are into action sports — such as snowboarders, extreme alpine skiers, X Games players — could potentially create huge numbers of followers. That crazy ride down the mountain, the double back flip — all these experiences can be shared in real time. The audience for those video streams are a great platform for targeted ads. It’s easy to imagine a shared revenue model between Twitter, the brand and the athlete. Similar business models work today on YouTube. It takes millions of followers per athlete to really make sense, though.”

You can read the entire article here.

iPhone Sales Slowing Down

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In the runup to the release of Apple’s Q1 2016 earnings report Tuesday, one of the big unanswered questions was whether the iPhone could maintain its sales momentum. Q1 2015 iPhone sales hit a record 74.5 million units, and it’s possible the latest quarter’s shipments may not equal — let alone exceed — that mark. IDC has forecast of slowing sales industry-wide for 2016. The smartphone market will see the first single-digit growth year ever.

Here is what I told E-Commerce Times, “Sales of refurbished smartphones are taking off, and Apple has ventured into this area. Refurbished iPhones can be sold in price-sensitive but growing markets without any brand dilution. It could be tempting to develop a cheaper product that’s being sold utilizing a different brand name in order to win in Africa, India and Indonesia, but the better strategy is to sell refurbished iPhones.”

You can read the entire article here.

Time Warner As a Potential Acquisition Target

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Time Warner CEO Jeffrey Bewkes this week hinted at a meeting with investors that he might consider a sale of the company, according to the New York Post. Apple, which reportedly is interested in purchasing Time Warner or its media assets, is keeping a close eye on the discussions. Buying Time Warner’s assets would give the flailing Apple TV streaming service much-needed programming: CNN, Turner Sports, shows such as Sesame Street and Game of Thrones, as well as movies and TV shows from Warner Bros.

Here is what I told E-Commerce Times about this. “Around this time 16 years ago, AOL and Time Warner announced their megamerger, [and] Time Warner then had the same problems that it has now. There were struggles to provide any meaningful return on equity. It was hoped AOL could provide the necessary Internet eyeballs that would breathe life into the aging media giant. Now, Time Warner is in the same position looking for a white knight who can make sense of the media conglomerate. Apple is in a far superior position than AOL was. AOL merely used its high-flying shares as a currency to cash; Apple would be able to pay cash.”

You can read the entire article here.

Amazon UK Launches Installment Payment Plans

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Amazon UK recently introduced a monthly payment plan — Pay Monthly — for customers who purchase products it directly sells and ships. The offer doesn’t extend to third-party retailers’ products on its site. Customers whose order, including shipping and taxes, totals Pounds 400 — about US$586 — are eligible for the program. Hitachi Personal Finance will provide and administer the credit and payments, and customers have to apply to that company for credit.

Here is what I said in an interview with E-Commerce Times about this, “Amazon has been uber-successful [because] it wraps a whole lot of convenience around the purchasing process. Pay Monthly is a logical extension of this value proposition. This service will make it easier for certain consumers, such as impulse buyers, to agree to a purchase.”

You can read the entire article here.