Apple Computer Inc. Case Analysis
Company Overview <ul><li>Apple Computer Inc. is designer and manufacture of personal computers, software, peripherals, net...
Mission Statement <ul><li>Leads the industry in innovation with its award-winning desktop and notebook computers, OS X ope...
Apple SWOT Analysis  <ul><li>Strengths  </li></ul><ul><ul><li>54% of Apple Profits are in foreign markets  </li></ul></ul>...
Apple SWOT Analysis  <ul><li>Weaknesses  </li></ul><ul><ul><li>Quality Product control </li></ul></ul><ul><ul><ul><li>iPod...
Apple SWOT Analysis  <ul><li>Opportunity  </li></ul><ul><ul><li>Enlarge target market with new product “Nike” </li></ul></...
Financial Ratio Analysis  <ul><li>Profit margin 9.97% (2006) </li></ul><ul><li>ROA 11.40% </li></ul><ul><li>ROE 22.90% </l...
Solutions/Future Outlook <ul><li>Apple can expect a prosperous future </li></ul><ul><ul><li>Steady increase in sales net e...
Solutions/Future Outlook <ul><li>Must minimize number of faulty components of its products </li></ul><ul><ul><li>Increase ...
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Apple computer inc

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Apple computer inc

  1. 1. Apple Computer Inc. Case Analysis
  2. 2. Company Overview <ul><li>Apple Computer Inc. is designer and manufacture of personal computers, software, peripherals, networking solutions, and music players </li></ul><ul><li>Products include: </li></ul><ul><ul><li>MacBook, MacBook Pro, Power Mac G5, iMac, Mac mini, iPod, Xserve G5 </li></ul></ul><ul><ul><li>OS X 10.4 Tiger, iTunes, iLife, Final Cut Pro </li></ul></ul><ul><li>Over 130 Apple Retail Stores in 31 states </li></ul>
  3. 3. Mission Statement <ul><li>Leads the industry in innovation with its award-winning desktop and notebook computers, OS X operating system, and iLife and professional applications. </li></ul><ul><li>Apple is also spearheading the digital music revolution with its iPod portable music players and iTunes online music store. </li></ul>
  4. 4. Apple SWOT Analysis <ul><li>Strengths </li></ul><ul><ul><li>54% of Apple Profits are in foreign markets </li></ul></ul><ul><ul><li>Knowledge of customer base </li></ul></ul><ul><ul><li>High Quality Products </li></ul></ul><ul><ul><li>Brand Name </li></ul></ul><ul><ul><li>Innovation </li></ul></ul><ul><ul><li>Product Diversification </li></ul></ul><ul><ul><li>Easy use product </li></ul></ul><ul><ul><ul><li>Attractive, Small, light </li></ul></ul></ul><ul><ul><ul><li>Easy to carry </li></ul></ul></ul><ul><ul><li>Apple is the oldest hardware manufacturer </li></ul></ul><ul><ul><li>Control over the product by manufacturing both computer and their OS </li></ul></ul>
  5. 5. Apple SWOT Analysis <ul><li>Weaknesses </li></ul><ul><ul><li>Quality Product control </li></ul></ul><ul><ul><ul><li>iPod Nano may have a faulty screen </li></ul></ul></ul><ul><ul><ul><li>Faulty ipod batteries </li></ul></ul></ul><ul><ul><li>High Price </li></ul></ul><ul><ul><li>Poor leadership </li></ul></ul><ul><ul><li>Internal engineering focus rather than a market focus </li></ul></ul><ul><ul><li>The Scare of LBO “Leveraged Buyout” </li></ul></ul><ul><ul><li>No Dividends </li></ul></ul>
  6. 6. Apple SWOT Analysis <ul><li>Opportunity </li></ul><ul><ul><li>Enlarge target market with new product “Nike” </li></ul></ul><ul><ul><li>Integration with other products “ Cars” </li></ul></ul><ul><ul><li>The use of Intel chips </li></ul></ul><ul><ul><ul><li>The Intel chip allows the new machines to run the Windows Operation System </li></ul></ul></ul><ul><ul><li>Developing iTunes and music player technology into a mobile phone format. </li></ul></ul><ul><li>Threats </li></ul><ul><ul><li>High level of competition in the technology market </li></ul></ul><ul><ul><li>High product substitution effects </li></ul></ul>
  7. 7. Financial Ratio Analysis <ul><li>Profit margin 9.97% (2006) </li></ul><ul><li>ROA 11.40% </li></ul><ul><li>ROE 22.90% </li></ul><ul><li>Gross Profit 4.04 B </li></ul><ul><li>Current Ratio 2.533 </li></ul><ul><li>Dept/Equity 0 </li></ul><ul><li>EPS 1.98 </li></ul><ul><li>Dividend payout 0 </li></ul><ul><li>P/E 32.45 </li></ul>
  8. 8. Solutions/Future Outlook <ul><li>Apple can expect a prosperous future </li></ul><ul><ul><li>Steady increase in sales net earnings over the past 5 years </li></ul></ul><ul><ul><ul><li>Almost 200% sales increase from 2004-2005 </li></ul></ul></ul><ul><ul><li>-Over 80% market share in iPods </li></ul></ul><ul><li>Must continue to develop and acquire new strengths </li></ul><ul><ul><li>I.e. Innovation, high quality products, good marketing plan </li></ul></ul><ul><ul><li>Threat of substitution/competition is decreased </li></ul></ul>
  9. 9. Solutions/Future Outlook <ul><li>Must minimize number of faulty components of its products </li></ul><ul><ul><li>Increase R&D efforts </li></ul></ul><ul><ul><li>Maintain customer loyalty </li></ul></ul><ul><li>Decrease prices </li></ul><ul><ul><li>iPod ranges from $300 to $400 </li></ul></ul><ul><ul><li>Mac desktop starts at $1300 </li></ul></ul><ul><ul><li>Result in gaining new customers </li></ul></ul><ul><li>Pay dividends </li></ul><ul><ul><li>Stopped paying in 1995 due to 2 for 1 Stock Splits </li></ul></ul><ul><ul><li>Competitors haven’t been paying </li></ul></ul><ul><ul><li>Improve stockholder loyalty </li></ul></ul>

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