Apple’s Billion Worth of Plans in the Future
Apple remains the highest revenue acquiring mobile company to date, and analysts are eager to know how the company plans to spend its billions of dollars.
Tim Cook, chief executive of the company, says that Apple's revenue this year has increased to $13 billion compared to the first half of fiscal 2012.
In its 2013 fiscal year report, Apple announced revenue totaling to $98 billion with net income of $22 billion. Rather than leaving old investments to still bring money to the company, Apple would still introduce product innovations and continue to gain profits from its latest product introductions.
Apple's growth in revenue doubles within a year as compared to Google's which only increases to less than a third of its most recent earnings.
Apple now has billions of dollars sitting in its vault that it impresses shareholders with additional dividends and the U.S. for paying the most taxes.
However, Apple earns faster than how the company spends its money, hence it is interesting to take a glimpse on Apple's plans of spending its billions of dollars in the future.
Will it invest on something that will make the revenue grow more or will it invest on something that Apple users can take advantage of?
Daniel Eran Dilger of AppleInsider sees three possible investments that Apple would likely be spending its money.
Bottle-Neck Competition with Samsung
People are aware that Samsung has been guilty of being a copy cat, yet, Samsung has been dropping hints that it is about to copy Apple again.
Samsung drop the hints when it announces a budget plan similar to what Apple has already announced.
Apple planned to invest 2 billion in 2013 to guarantee component supplies. Consequently, Samsung's biggest rival, Taiwan Semiconductor Manufacturing Company, announced a 9 billion increase in capital for 2013. These announcements from two of Samsung's greatest rival are seen to put a toll on Samsung's investment plan this year.
According to Mr Dilger, "Given that Apple's been running the Smartphone race really well despite harboring that Galaxy S knife over the past three years, it will be interesting to see how well Samsung does in the 2013 lap as the course heads uphill into even more difficult terrain, now that it has its knife back and is no longer inextricably bound to the world's fastest consumer electronics sprinter."
1 billion worth of retail expansions and enhancements
Apple has plans of spending 1 billion to open 30 new stores and re-open 20 existing stores in larger locations.
In the latest company investor's call, Mr Cook said that Apple is moving forward. "We still see significant opportunity in China. It's a great market. We have 11 stores there. We expect to double those in less than two years. We have added about 8,000 iPhone point-of-sales in the indirect channel to about 19,000 today, and we obviously have a plan to add more and further grow our distribution. This number is, obviously, too low currently."
$4 billion worth of new software and app
Apple, will absolutely, spend part of its billions of dollar revenue to provide its loyal users new and exciting software.
According to Oppenheimer, "we are now paying very happily our developers more than 1 billion every quarter." This is the highest payment that Apple gives its software developers since opening App Store four years ago.