问答题 As Apple prepares to report what (analysts project) may be the company"s first year-over-year quarterly earnings decline in a decade on Tuesday, it is also grappling with jittery investors and a recent share-price plunge that has wiped about $280 billion off its market capitalization since its stock reached a high of $702.10 last September.
1 Much of the investor nervousness is rooted in how Wall Street is treating and valuing the Cupertino, Calif., company as a traditional hardware maker. One camp of analysts and some investors said there is strong evidence that Apple should be viewed in a different light: as a software-hardware hybrid.
The distinction matters. If it continues to be seen as a hardware business, Apple"s streak—driven by products like the iPhone and iPad—could run out quickly as smartphones and tablets get commoditized and consumer tastes change. 2 It is a lesson learned by companies like BlackBerry-maker Research In Motion Ltd., whose tech hardware was quickly eclipsed by products from Apple itself.
If Apple is classified as a software-hardware hybrid, the company could be valued more like Internet and software makers that have recurring revenue streams and that often trade at higher price-to-earnings ratios than hardware firms.
"The market views Apple as a consumer hardware company tied to product cycles that drive volatile revenue and earnings streams," says Morgan Stanley analyst Katy Huberty. 3 But that view isn"t complete, she says, since "Apple customers buy into a brand that offers ease of use similar to companies like Amazon.com or enterprise companies like NetApp." An Apple spokesman declined to comment ahead of Tuesday"s earning report.
With Wall Street categorizing Apple as a hardware maker, investors value the company-which made an astounding $13 billion in profits in the quarter ended in December—at 8.6 times expected earnings per share for the next 12 months. Investors are currently valuing Hewlett-Packard Co., which made $1.2 billion in profits during its most recent quarter, at a price-to-earnings ratio of 5.6. Troubled PC maker Dell Inc., whose stock price inflated after signing a buyout deal earlier this year, trades at a P/E ratio of 8.5.
Apple"s gross margins are around 40%, an important-measure of the company"s efficiency at making money. That is roughly twice as high as H-P"s and Dell"s.
Apple has characteristics that differ from many other hardware businesses. 4 Its customers often upgrade their Apple products annually, far more frequently than the four-gear PC upgrade cycles typically found at tech hardware businesses including Hewlett-Packard or Dell.
While H-P and Dell have tried beefing up the enterprise software side of their business, Apple"s operating system and iTunes software is already ubiquitous. 5 Apple also has more than 500 million accounts for its App Store tied to credit cards—and a customer base to sell new services to—giving it a recurring software and services revenue stream. Apple took in revenue of $3.7 billion from iTunes and other software and services in its last quarter, or 7% of its total revenue.