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Apple’s cash and marketable securities increased to $76,156,000,000. The increase was 15% sequentially or $10.4 billion in three months. That’s the equivalent of an increase of $11 per share (to a current $81.2/share.)

The composition and growth of liquid assets is shown in the following chart:

There is little I can think to say about this that hasn’t already been said (see last Critical Path show.)

Except maybe that the amount is now nearly 16% higher than three months ago. And that the amount added last quarter is higher than the amount on hand 4.5 years ago. And that the cash added is higher than Google’s overall revenues in the quarter.

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Footnote:

In Q1 2009 the company’s share price briefly traded at $78. A buyer of shares at that price will have recovered their investment in retained earnings in nine quarters.

Here were my predictions for the third fiscal (second calendar) quarter from April 25th.

Estimates for Apple’s third fiscal quarter (ending June) | asymco

Later in the quarter I updated them for submission to Philip Elmer-Dewitt’s blog at Fortune. The original and updated figures are shown in the following table (with actuals).

The changes were not significant except in a reduction of iPads. Three items were better in the early call and three were better in the late with one item equal. Using a simple method for scoring the results I gave myself the following report card:

 

As the Revenue and EPS figures are dependent on the other line items, the most significant error is clearly the iPhone where the error was over 30% (and hence deserves an F). The other figures were not very close either  so the overall grade point average is a very mediocre C (2.3).

So, as in previous quarters, nailing the iPhone number is everything. Having failed to guess correctly, the whole performance fell apart.

So how did I manage to get the iPhone number so wrong? Continue reading “How did I get the iPhone number so wrong?”

An interview with Horace Dediu.

Curiously, given the high specs, I find myself using only an iPad for a week (without access to AC current).

Windows Phone Marketplace has reached 25,000 apps. That’s an impressive figure given that so few devices have actually been sold. Compared with Android which is activating half a million devices per day, Windows Phone seems like a rounding error. According to Gartner, 3.6 million smartphones using a Microsoft mobile OS were sold in the first quarter of 2011, of which 1.6 million were Windows Phone 7. That implies a daily activation rate of 17,500 per day or one WP device for every 28 Android devices.

And yet the number of apps on Windows Phone is more than 10% of the number of Android apps and Android Apps are about half of iPhone apps. As far as Windows Phone is concerned, apps are being added faster than users. Why is this?

If we take the point of view that mobile platforms behave like the computing platforms of years gone by (i.e. Windows vs. Mac) then this is inexplicable. Developers should not be bothering with a distant third. This would be like betting on the Amiga in the era of Windows.

But we’re not in the PC era any more. That era had very high software development costs. It had very difficult software distribution channels (retail box sales typically) and very few categories of software with high price points. It was also dominated by institutional buyers which did not give quarter to small vendors. It was also a time when there were orders of magnitude fewer users and even fewer buyers.

The post-PC era is characterized by an explosion of ideas and application of new talent to software. It’s an era of immediate gratification and painless, one click distribution. App production is a cottage industry not something entrusted to only a few experts or those who can raise venture capital. It allows the small to distribute widely and get a shot at stardom. It has been (thankfully) avoided by enterprise buyers. The result is an explosion of apps: well over half a million new apps have been built in three years on three platforms that did not exist three years ago.

So the very reasons which are driving developers to spread their bets across all and any new platforms should indicate the potential for new platforms and the sustainability of small platforms. The thesis that one dominant platform wins the mobile “war” is naive. The post-PC era will be a multi-platform era. Developers already understand this. Platform vendors know this. It’s time to unlearn the lessons of the PC era.

The Critical Path #3: It’s Good to Be King – 5by5.

July 3, 2011 at 6:00pm

Horace Dediu and Dan Benjamin discuss the power of cash to control supply chains in the post-PC era and how Apple is challenging conventional wisdom about its value to shareholders.

RUNTIME: 57:19

The Critical Path is also available on iTunes. Don’t miss a show, subscribe.

My thanks to Robert van Apeldoorn, journalist for Trends Tendances Magazine, for asking good questions. My responses are reproduced below. The article (in French) is titled “Nokia a trop écouté les réseaux télécoms” and can be found in the June 23rd edition of the magazine along with more details in the article “Comment Nokia peut-il renaître?”.

-About your post “Does the phone market forgive failure”, that puts forward the idea that all mobile device vendors experiencing losses never really recover… It seems that this possible “rule” is more severe than in the computer industry. If Digital Equipement, Compaq, WordPerfect did fail, IBM and, yes, Apple, did survive failure and rebound strongly. Do you think that there is a difference between the industries? What makes the failures more lethal in the mobile device market ?

The observation is unique to the mobile phone market and even there it’s only an observation not a rule. It could be that Nokia will be the first mobile phone company that will recover from severe crisis, but history shows it to be very unlikely. I try to shed some light on the reasons why it’s unlikely and what makes the mobile phone market so unforgiving. I think much of the problem rests with the fact that mobile phones are sold indirectly, through intermediaries who are amplifying both success and failure. A company like Apple was able to recover in the computer industry because it launched new products like iPod which could be sold directly to consumers. It had to convince the consumer and only the consumer. Having to convince a distributor, retailer, value added reseller, operator and consumer would be much more difficult. These intermediaries are “institutional” buyers who are risk averse and have low tolerance for untested ideas. Institutional buyers need to think about dealing with other people’s money not just their own so they are doing the right thing from their point of view.

Nokia needs to persuade first operators, then distributors and then consumers that its new products are great (even though maybe the old ones were not so great.) That’s tough. Apple works in the other direction. It creates consumer demand then “sells” that demand to the intermediaries as needed.

These intermediaries (which Steve Jobs famously called “orifices” to the market) Continue reading “Nokia a trop écouté les réseaux télécoms”

“This is my site. It’s an evolving experiment in collaborative and peer reviewed analysis.”

via MacDirectory: Exclusive | Horace Dediu: Apple expert.

The Post PC era just turned more so.

Coincidence?

You can still get the t-shirt.

The 200 most popular words used to describe the Asymco audience. The data is obtained from 4.3k twitter bios (approximately 55k total words). Generated using Wordle and a bit of Automator, grep, and BBEdit. Click/tap on image for more resolution.

A summary of the attributes of the best audience on the web.

Any student of organizational theory must struggle with the question of how to assign weight to the influence of the leadership of a company. In the case of Apple, the question is:

Is Jobs is the embodiment of Apple or is Apple already Jobsian, imbued with his ethos?

John Gruber summed up (start at 8:00 min) the “Apple is Jobsian” argument by saying that Apple is Steve Jobs’ greatest creation and that he has been working on crafting the company as much as he has been crafting products. The result being that it’s well designed for sustainable longevity.

The arguments for “Jobs is Apple” are mostly rooted in anecdotes of a supreme leader that is indispensable to every decision and detail. There are also ample examples from history of companies who foundered after the departure of founders (Apple itself is notably cited.)

But beside armchair quarterbacking, what evidence is there that Apple is being engineered to operate independent of its founder? Continue reading “Codifying asymmetry: How Apple became Jobsian”