I’ve more or less moved to Apple News

(And here’s where you can go to visit the channel (requires iOS device in or set to US, UK or Australia for now), and hopefully add the ‘Tree to your roster of favorite channels: https://t.co/IWseKSCmDV )

The transition’s more or less complete, and I’m now able to post in “native” News format. I certainly wouldn’t have minded updating both this blog and the Apple News channel at the same time, but that apparently is impossible in the WordPress Free context – and I don’t have any current plans to “hire” a web host + get WordPress Regular + Apple News plug-in.

Well, not yet anyway. One thing at a time for this humble blogger.

For those dozen or so loyal readers, some of whom may not have an iOS device or be in an area where it’s practical to access Apple News, I apologize, but it’s difficult for me to “port” my Apple News posts back to WordPress. Basically it only kinda works on text. Hyperlinks and images have to be imported manually. The TL;DR blog syndrome I suffer from 😰 doesn’t help any.

And, believe it or not, when the post content or gravitational pull of the moon or the day is right, I bring in way more Apple News readers than I ever did WordPress readers.

So even though I feel WordPress is a better blogging platform overall, it’s really a no-brainer for me, in terms of getting readership anyway, to continue focusing on the News channel for the time being. No seriously, if you only knew how many daily visitors I can now get on a good day, you might straight-up laugh in disbelief. Granted, it’s still not much, but it’s better than the 100-ish visitors I used to get on a very good day in WordPress-land, and that’s when I was posting more regularly.

Hey, if it makes you feel better, I’m getting just about zero “advertising revenue” from this “iOS-only” experiment. Yeah, I kinda wish Apple News was compatible with the desktop Web too. Alas.

The blog isn’t going anywhere, but, just wanted to let you know where the new stuff’s moved to. As always, thanks for reading.


_____ Than Feared: iPhone 6s/Plus Are Mostly on Their Own for $AAPL’s Transitional FQ2 2016 (+FQ3 Quick Look)

(REMINDER: Please refer to the About + Disclaimer section. You won’t ever find actionable investing/trading advice here, just a humble home gamer in his corner of the Web trying to understand Apple and tech a bit better. As you know, no one has any clue what AAPL stock will do from day to day, quarter to quarter, year to year, even if earnings “seem good enough”.)

Also – TL;DR warning, more than usual. Don’t try reading this in one sitting. I know, the late posting doesn’t make things any easier.

A Relatively Glum Apple Quarter, Which, Like Many Before It, is Already in Wall Street’s Rear-View Mirror

As it so happens, the AAPL bears and skeptics were most correct about Apple’s FQ1 and its FQ2 guidance (yup, I’m more than fine admitting when I’m wrong) – though the stock itself had already bottomed out by that time of the late January earnings release.

Apple’s resistant, but not immune, to intense ForEx pressures and global macroeconomic uncertainty. Apple bulls (myself included) have had to recalibrate quite a bit, given the twin outliers of

(1) an incredible demand for iPhone 6/Plus (Apple’s very first BigPhone/HugePhone lineup), which may bear a passing resemblance to my “sales nova” hypothesis, and

(2) broad-based economic “nervousness” (since I don’t see any “world is in recession!” headlines in the news) putting a damper on global spending.

The question now is, has Wall Street crossed the line of overcorrection, or is the current consensus of around -3% revenue growth for the entire fiscal year actually giving Apple the benefit of the doubt? Continue reading

Part 2/2: With iPad Pro 9.7 and iPhone SE, Apple Gets “9-10% of the Way There”*

*(For the year; in annual revenue terms; maybe. More on this later.)

Part 2 of 2 covers iPhone SE, and “adds it all up.”

Part 1 of 2, in all its TL;DR “glory”, is here.

How Apple Got to 900+ Million Sold: iPhone, 7 B.I.P. (Before iPhone Phablet) – Present


Prior to Apple’s September 2014, “extremely late” move to up-size iPhone (for the second time), it sold quite a few smartphones that were (1) iPod nanos by comparison and (2) really quite popular, despite blogger/pundit complaints spanning no 3G, no LTE, accursed sealed-in battery, insufficient SoC RAM and no expandable memory, to say nothing of the closed OS.

Continue reading

Ye Olde AAPL Tree Blog is Moving, Sorta!

You may have noticed me kvetching (am I using that right?) about the conversion from Apple News RSS (which…took a while to get on in the first place, because I’m a nobody) to the new-to-most Apple News Format (which…hopefully takes less than a month since I’m already on RSS, but then again, I remain a nobody).

I’m a bit excited to get started blogging on Apple News, given the newness of the platform and the small chance my posts find a broader audience. (As for the prospects of me making back any significant portion of my $99, um, “news developer fee”/earmarked tax write-off 😛 in iAd revenue…well, I should probably cut back on the coffee budget, anyway.)

For those few but much-appreciated regular readers of mine, a quick Q&A on the changes.

Are you “going premium”?


let me catch my breath


[POST-WWDC 2016 UPDATE – Well, Apple News now has subscription options added in as of iOS 10. So, leave me to my momentary delusions of getting even $20 in subscription revenue per year, TOTAL, for the moment.]

You’re telling me you might post more than once or twice a quarter? YOU.

Quite possibly. Maybe once a month! 😉 Actually got inspired to write up 2-3 posts in the span of about a week. So, depends on how things go.

Where will I be able to find your newest blog stuff?

On the “AAPL Tree” channel, same as currently, except it’ll be hosted directly from Apple as I understand it vs. the current RSS approach (unless I find my own Apple News-compatible host as a mirror).

Here’s the direct iOS-only link to my channel:


What if I’m not in the US, UK or Australia? 

I have readers outside the US, UK and Australia? Kidding, I know I have a few, to add to that other few in the Apple News-supported regions, all of two countries. And I appreciate you all.

I’ll probably re-post most articles to WordPress within a few days after publication to Apple News (which, according to Apple, is a matter of seconds once you’re cleared to post in Apple News Format without restriction, vs. the 30-60 minutes or sometimes never via RSS). For stuff like Apple earnings, I’ll try to post to WordPress with a shorter delay. Apple News Format, unfortunately, is not nearly as “copypasta-friendly” as WordPress, though as you’ll see from my Hyper Light Drifter review (should it ever appear), Apple News Format does help make blog posts look better on a basic level without much effort.

If I feel so inclined, how might I support your work, should you be cleared to post in Apple News Format?

Well, shares, recommendations, and retweets are the lifeblood of my ego – er, this blog – it’s all related, isn’t it? 😉

If you’d be so kind to support me, indirectly, financially, well, I know I don’t have a fraction of the necessary audience for, say, Patreon, but rumor (read: Apple’s own public-facing stuff) has it Apple parcels out ad revenue to news content creators…and I have yet to see a single ad on the News app. But if you DO happen to see one near a post of mine – and you have the bandwidth/time to spare – I dunno, try clicking it now and then to see what happens.

Closing in on three years and a bit over 250 posts, I’m interested in seeing how my next “phase” in blogging goes. Thanks for reading, and I hope you can catch my newest posts on the News app in “native” format soon!


Part 1/2: With iPad Pro 9.7 and iPhone SE, Apple Gets “9-10% of the Way There”*

Part 1 of 2 covers iPad Pro 9.7.

* (For the year; in annual revenue terms; maybe. More on this later.)

To radically oversimplify what happened during Apple’s March 21 event,

• Apple brought the prior “full-size” iPad “upmarket” with iPad Pro 9.7,

• while bringing an impressive swath of upmarket features to the iPhone 5S “shell” in the form of iPhone SE, while also lowering the “most affordable iPhone” price floor to $399 (US) from the prior $449 that’s been in place since…probably the days of iPhone 3GS becoming Apple’s first “free on 2-year contract” phone (remember those?) circa October 2011, nearly 4.5 years ago.

But what do iPad Pro 9.7 and iPhone SE mean in terms of impacting Apple’s revenues? Do these products even make much of a difference?

After all, Apple’s FQ1 (FQ = Fiscal Quarter) 2016 results and conference call (citing, among other factors, strong global macroeconomic headwinds) have a lot of people – including your humble correspondent – wondering if Apple can grow revenues at all from FY (Fiscal Year) 2015. (Case in point: All those analyst revisions seeing Apple annual revenues down about 2.7% YOY on Yahoo! Finance as of March 29, 2016 – it wasn’t always that way.)

I’ve been thinking about the revenue impact question here and there since the March event rumors started popping up, and while this blog never does treatises, I do have something of an outline, home-game-humble like always, for your “consideration”. So let’s look at how iPad and iPhone SE might, within a year of launch, get Apple around 1/10th of the way to its current, $230B-ish level of annual revenues. Continue reading

Apple’s $2B, “Two-Dime” Accounting Change: Home-Gamer “Quantifying” Apple’s September 2015 ESP Deferral Adjustment

ONLY if you dare to get some “background”: I’ve gone down the unknowable rabbit hole of ESP (estimated selling price, software upgrade rights) deferrals twice, before.

As you know, we here at The AAPL Tree I often like to cover those topics a bit lesser known about everyone’s favorite continually-pressured-in-some-way smartphone and a few other things company. And this looks to be another such topic.

Luca Maestri, about 20:45 into Apple’s FQ4 2015 earnings conference call (podcast link available here for another few days or so)

“Second, in September, based on an analysis of market offerings, we reduced the estimated selling price of future software upgrade rights and non-software services that we defer for each iOS device and Mac sold. The reduction is between 5 and 10 dollars per unit.”

(Luca also announced that Apple would be extending iPad deferral revenue recognition period from 2 years to 3 years, which is an interesting “statement of opinion” from Apple on iPad lifecycle.)

Note also Page 45 of the FY15 10-K (Apple 10-K, linked at Investor Relations site.):

“Beginning in September 2015, the Company reduced the combined ESPs for iOS devices and Mac between $5 and $10 to reflect the increase in competitive offers for similar products at little to no cost for users, which reduces the amount the Company could reasonably charge for these deliverables on a standalone basis.”

(Also note: iOS devices are specifically defined as iPhone, iPad and iPod touch – we’ll assume pretty much 100% of GAAP-reported unit sales are “qualifying sales” – to the ostensible exclusion of Apple TV and Apple Watch, although the latter two device classes do have ESP deferrals.)

What could this reduction in deferrals amount to across Apple’s balance sheet in the Fallow Harvest of Fiscal 2016? 😀

Continue reading

$AAPL FQ4 2015 Earnings Preview + FQ1 Quick Look: Trajectory and Trust

Welcome to the AAPL Tree’s tenth (!) consecutive home game quarterly earnings preview. I know, I didn’t think I’d ever get here either. OK, milestone marked.

Yep, the key storylines are the same as ever. “iPhone and Apple Watch”. Of course, there’s more to it than four words. 😉 But those are, for now, the only topics that make much of a difference at this point. So we’ll cut to the chase, relatively speaking. (UPDATE: OK, I “lied” – 2600+ words.)

(REMINDER: Please refer to the About + Disclaimer section. You won’t ever find actionable investing/trading advice here, just a humble home gamer in his corner of the Web trying to understand Apple and tech a bit better. As you know, no one has any clue what AAPL stock will do from day to day, quarter to quarter, year to year, even if earnings “seem good enough”.)

Continue reading

The US Smartphone Wars According to comScore, June 2015 Update – Apple Makes a Move

(Notes: The comScore report “lags” two months – the original date of publication is Aug. 7. Also, this post is primarily in the context of “market share”, which inherently does not account for market unit growth year-on-year. And since this is a comScore meta-analysis, take as many grains of salt as you may require.)

That Was Then, This is…Not Quite One Year Later

When I last looked at comScore’s US smartphone market share data (in November, part 1 is here, part 2 is here), Android OEMs (dominated by Samsung, then LG, Moto and HTC rounding out the “Big 4”) were holding steady at a greater than 50% “market share” per comScore’s 30,000-person survey of smartphone owners, measured on a 3-month average basis. (So, call it a hybrid of installed base and market share analysis, considering the methodology.) Meanwhile, Apple was in the low 40s, but it didn’t look like much else was happening. Android was “holding steady” since Dec. 2012, more or less, and Apple “appeared to have plateaued” (though with a bit of net upward movement from late 2013 onward).

When I took a closer look at the data, though, I noticed Samsung, as the US Android standard-bearer, was losing positive momentum in a pretty relentless way. Combined with their dramatic reversal of financial fortune – and retrograde growth starting CY14 – I predicted that Apple would experience “comScore market share growth” of closer to 400 basis points (similar to its Dec. 2012 – Feb. 2013 comScore share jump) than flat growth (read: essentially zero).

How’s that prediction turning out so far, with 3 data points left to measure? Approaching half-right, perhaps, but that’s secondary to the trends themselves.

Continue reading

Mav’s $AAPL Maths 101: 2016 Price/Earnings Multiple Calculation, Assuming No Share Price Change, “Normal” + Ex-Cash

I know a few of the arguments against the price/earnings ratio, so I won’t waste words debating them here.

“In the Present” Preliminary Reference Notes:

As of today, Apple’s ttm P/E is (based on Apple’s 10-Q filing of 5.77B diluted shares outstanding) $655.18B est. market cap / $50.737B ttm earnings = 12.9. Where Yahoo! Finance gets its 13.13 and Google Finance its 13.11, I’m not exactly sure, but close enough. Net out Apple’s $149B in net-of-debt cash, and the current ex-cash P/E is around 10, give or take a few percent.

Step One: The Forward P/E

AAPL last closed at $113.49. We’ve gone from Calvin Harris (feat. Kelis) (“Bounce”) to Ella Henderson (givin’ up the ghost) in one day’s time. What next? A Panic! at the Disco? Well…given that pre-market price action…

Full fiscal year (FY) 2016 estimate courtesy of the 47-member Yahoo! Finance (professional) analyst consensus: $9.78 (you’ll see how amusing this number is later on)

Forward P/E (Sep. 2016 FY-end basis, in practical terms, “as of around the late October 2016 FQ4 earnings release”): around 11.6.

Step Two: Ex-Cash Forward P/E

Cash Estimate

Well, to figure out the ex-cash circa. Sep. 2016 P/E, let’s wild-guess what Apple’s cash balance might be in around one year’s and a few weeks’ time.

Apple’s cash balance net of debt is currently $149B. Apple should generate greater than $50B in cash this fiscal year and (yes, I’m calling it now) the next. How do I know this?

Well, as of the end of FY 2014, Apple had $120B net of debt (let’s just assume Apple won’t be paying its hard-borrowed cash back anytime soon – why would it?). We’re $29B north of there:

  • with $22B in share repurchases through FQ3 2015
  • with $8.6B in dividends paid
  • with $7.6B in PP&E purchases (Apple 10-Q, FQ3 2015, pg. 6)
  • with $10.6B in cash (income) taxes paid (same)
  • with $1.3B in taxes paid related to net share settlement of equity awards (same)
  • with $427M paid in interest (seems almost trivial by comparison, doesn’t it) (same)

That’s a grand (sub)total of $50.5B in outflows through three fiscal quarters. Sure, there’s probably some significant counterbalancing inflows not listed here, but – you get the picture, I think. Given all this, I’ll wild-guess a basically static cash balance of $150B.

Share Repurchase Estimate

Seems pretty conservative, even if you add:

• a dividend increase (10%, call it $1-1.5B year-over-year increase in dividend expense?) and

• a faster-than-this-year’s-pace of buybacks I’m projecting ($38B, net of $3B or so share-based compensation expense) if AAPL Silly Season continues much longer – “unlikely”, but you never know.

That $38B is itself fairly conservative when you consider that Apple is due to repurchase some unknown billions of stock for FQ4 2015 – don’t think it won’t take a serious look at buying “more than it otherwise might” during this latest selloff.

Subtract the $38B in net share settlement from Apple’s current ~$655B market cap and you get a 5.8% share reduction, to 5.435B or so diluted shares outstanding versus 5.773B or so now (the most recent share-weighted data point).

FY 2016 EPS Projection

Let’s run a zero-growth baseline just for kicks. Meaning we (1) accept analysts’ FY 2015 EPS projection – which Apple should get to, absent something actually apocalyptic happening to the yuan – say somewhere north of 10% devaluation impact in a quarter, which Apple cannot mitigate with its world-class hedging program, and a ripple/shock effect on consumer spending, both of which seem…premature to call as of today. Then, (2) since we’re assuming zero growth from Apple (oh, people will start thinking that, just you wait), just subtract the net buyback amount to get the fully-financially-engineered FY 2016 EPS number.

FY 2015 Yahoo! Finance consensus EPS: 9.13

Divide by .942 (5.8% share reduction) to arrive at:

FY 2016 EPS: $9.69, also known as nine cents or one percent below the 9.78 analyst consensus. What a coincidence.

~$655B – $150B net cash = ~$505B

Given $113.49 share price:

Forward P/E: 11.7

Ex-cash P/E: *9.02*

Well, if you really want to turn on the pessimism and ignore the significant valuation backstops added since then (from share splits to capital return to Uncle Carl Icahn), Apple’s ttm P/E went to 10 (maybe a bit low briefly)? during the Dark Times of late 2012 to mid-2013.

That’s, what, another 20% or so drop from here? To…$520B or so market cap?

If I had to guess, Apple, with its $150B in net reserves, would not mind racing to retire another 10% of its shares (with an accompanying $1B+ in dividend payout savings per year) if the right opportunity presented itself. It’ll be fascinating enough just to see what Apple does in the next few weeks before quarter-end. As long as the fundamentals hold up, a swoon for investors could well be a boon for the company.