How to forecast $43.6 billion?

Apple has finally decided to give its shareholders back more now from the profit of $145 Billion. The shareholders demanded more return even though Apple posted their first decline in decades. Apple heavily relies on new product launches to make the mass amount of money; knowing this fact the company has decided to not launch any new products until fall and 2014. The company has to give the raging market a rest for a couple of months before they come out with something that will make the crowd go wild. The fall in the revenue has challenged the company to think of something truly innovative that will gain a higher popularity in sales than its competitors.

 The company did better than forecasted $39.2 billion; the actual revenue was $43.6 billion, exceeding the forecast by $4.4 billion. Apple had under forecasted due to past months revenue being over forecasted. As we learned in class, companies usually use naïve approach to forecast for their next month. Apple has been over forecasting since their iPhone sale success. Apple is not coming out with new innovative technology, their revenue has been declining therefore forcing the company to under forecast their revenue. This is the error of using forecasting because the company might not sell the same as the previous month because the company has not been able to come out with a product that would stabilize their revenue. In Apple’s case new product launches raise their revenue and place them on top of other companies.

 Many people are thinking that since Apple is not going to be launching any new products for a few months, the market is bound to fall. Samsung has been giving Apple good competition and now has been able to take over the market with recent launches. If Apple waits until fall to hit the market again with something innovative, will Samsung have taken over the market? Will Apple be able to compete with Samsung after staying out of the market for a couple of months? Only time will tell how innovative the new Apple products will be. Will the Apple products be able to beat the Google Glasses? Many people are not really sold on the new idea of using glasses as their cellphone but again no one can really tell how the market will react to products until they are launched. Before Steve Jobs died, he mentioned that his new invention was to make the TV remote user friendly. He emphasized that the remote was too complicated with so many buttons. This might be just the product to beat the Google Glasses or not. We all will have to wait for the next invention until fall of this year to find out.

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Sources: Gupta, Poornima. “Apple unlocks more cash for investors as profit slides.” Chicago Tribune 23 April 2013, Web. 28 Apr. 2013.


7 thoughts on “How to forecast $43.6 billion?

  1. I like the fact that Apple is thinking of other ways to retain customers and reward its shareholders for their loyalty. They definitely did this strategically, in order to stay afloat in the market. It is smart of Apple to wait to launch another innovative product; this also creates anticipation among their customers. By doing this, they will probably come back with a vengeance and surpass their forecast revenue for the next following years.

  2. Apple is a company which success relies on their true and loyal customers, any new product they come up with will for sure boost up their revenues! Many people make comments about their new products, such as the mini, how it was pointless since there already was the regular ipad, and an itouch but ipads minis sold out when they came out, all thanks to the loyal customers! Apple knows how to market their products in a way that no other company cannot compare!

  3. This was a fantastic example of how companies use qualitative information when forecasting. In apples case, there are many other factors effecting their sales other than numerical data. I think it is wise for the company to create a gap when releasing products because otherwise consumers may start playing the waiting game and there revenue could drop dramatically. Apple has a high level of customer relationships so they probably are not too threatened by google or Samsung.

  4. I agree with the comments above in regards to customer loyalty. Apple has a strong customer base, many of which remain very loyal to Apple. Although they may have experienced a decline in sales because they aren’t launching any new products at the moment, when they do finally launch a new product, sales will probably increase due to the fact that they have a lot of loyal customers.

  5. It is nice to see that apple is finally giving rewarding its investors for the support and faith that they have given to apple and its products. With other competitors coming out with innovative products it will be really interesting to see what will apple come out with that will put them on top of the hill again. I don’t think apple would be too worried about their recent decline seeing that they haven’t launched any new products out, but it wont be shocking to see if their sales and stock prices to go up in fall when they come out with new products be it the tv remote or the iwatch.

  6. Having customers play the waiting game will make them more hungry for Apple’s new product in fall. Although this company has had an outstanding track record with sales, I believe with the comments above that their releases on new products are too quick because it does not really give the loyal customers a chance to enjoy the new product.

  7. I agree, it is nice to finally see Apple paying their shareholders. I don’t think Samsung will be able to take over the market any time soon. This is because Apple has such a large number of loyal customers. However, I am interested in what new products Apple has to show to retain its top spot.

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